The year 2023 could be a year marked by social tensions at a global level, the managing director of the International Monetary Fund (IMF), Kristalina Georgieva, worried this Thursday, while the effect of financial tightening on employment “is yet to come”.
However, if the rise in rates ends up affecting the labor markets, a logical consequence of the slowdown objective, it could generate additional tensions, warned the head of the international institution.
“Inflation that remains tenacious”
Especially since the situation is not going to improve, due to “inflation that continues to be tenacious” and in the face of which “the work of the central banks has not yet finished”, recalled Kristalina Georgieva, implying at the same time that “the crisis is probably not over”
Although the economic slowdown should be greater in 2023 than predicted by the Fund in its latest publications last October, domestic labor markets have so far shown “evidence of resilience”, Ms Georgieva stressed, “which is a point to favor”.
This is mainly due to “the fact that governments have moved quickly to provide financial support to populations in the face of rising food and energy prices. But the space available is shrinking.”
“While people have jobs, even if prices are high, they consume, which helped the economy in the third quarter, particularly in the United States and Europe, but we know that the impact of the adjustment is yet to come” in terms of unemployment, insisted the head of the IMF.
At the same time, the impact of the rate hike on indebted countries will also be dramatic, recalled the head of the IMF, whose institution has been warning for several months of the risk that around 60% of emerging and developing countries will fall into a debt crisis. sovereign debt crisis.
Source: BFM TV
