Kristalina Georgieva celebrated that the United States controlled inflation without recession

The head of the International Monetary Fund said that The United States is “definitely” headed for a soft landing thanks to the “decision” of the Federal Reserve in terms of controlling inflation despite some impacts from higher interest rates.

“It has produced the desired effect without driving the economy into a recession.”said the managing director, Kristalina Georgievain an interview with Christiane Amanpour on CNN International airing Tuesday.

The cooling of both inflation and the labor market in the US after the steepest cycle of interest rate hikes in a generation It has raised hopes that the world’s largest economy can avoid a deep recession and opened the door for the Fed to cut rates this year. Bloomberg Economics says reductions in borrowing costs could begin in March.

The dollar is preparing for its worst year since 2020

When asked about the electoral prospects of donald trump in 2024 and the possible return of its protectionist trade policies, Georgieva said that the Monetary policymakers must help those affected by globalization or they risk fueling resentment and isolationism.

“We will see in the US, Europe and everywhere, a backlash against what makes us all richer and safer: an integrated global economy,” he said.

Consequences of fragmentation

As US-China strategic rivalry escalates, IMF warns of economic damage from fragmentation, which, according to estimates, could sacrifice up to 7% of the world’s gross domestic product. Georgieva said this threatens to cut off access to essential minerals needed for green technologies of the future.

“If we end up without access to them, that can have a serious impact on future competitiveness in a rapidly changing global economy,” he said.

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