IMF foresees a slowdown in global inflation in 2024

The International Monetary Fund recently indicated in a report that it foresees a reduction in global inflation this year of 5.9 %.

According to Pierre-Olivier Gourinchas, economic advisor and director of the IMF Research Department, this would mean disinflation just below that achieved in 2023, of 6.7%.

In the article, published on July 16 by the IMF, Gourinchas also points out that “in some advanced economies, especially the United States, progress on disinflation “has slowed and the risks point to the upside.”

The IMF has noted a balance in risks, although two downside risks in the short term have gained importance.

New inflation challenges

According to the international organization, “the new challenges of disinflation in advanced economies could force central banks, including the Federal Reserve (Fed), to keep borrowing costs elevated for longer.”

This would certainly pose a risk to overall growth, with further upward pressure on the dollar, as well as negative spillovers to emerging and developing economies.

“There is a growing body of empirical evidence, including some of our own, that points to the importance of broad global inflationary shocks – primarily energy and food prices – as drivers of rising inflation and its subsequent decline over a wide range of countries.” range of countries,” the IMF has said.

But it’s not all bad news. The international financial entity has clarified that as the general shocks eased, the inflation rate was reduced without causing a recession.

In any case, they maintain their focus on the increase in energy and food prices, which has reached levels similar to those before the pandemic in many countries, although it is not general inflation.

M.Pino

Source: finanzasdigital

(Reference image source: @Analitica, X)

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