The head of the International Monetary Fund said Wednesday that the US and other wealthy nations need to urgently tackle mounting global debt levels that are weighing most heavily on low-income countries and straining the global financial system.
IMF Managing Director Kristalina Georgieva said that while US Treasury Secretary Scott Bessent and other US leaders recognise that the federal deficit and national debt have grown too high, just trying to grow the US economy out of its more than $40 trillion in national debt would not suffice.
Rising bond yields, reflecting the higher premiums associated with greater risks, have meanwhile been disrupting financial markets.
“At the fund, we believe that, growth, of course, helps, but it cannot deliver fast enough the necessary adjustments,” Georgieva said at the autumn meeting of the IMF and World Bank in Bangkok.
“There is no magic,” she said, noting some other measures would be needed. “You have to go in a direction of tightening … bringing the deficit down.”
