The US Federal Reserve, the European Central Bank (ECB) and
others have held interest rates elevated in recent months in an attempt to
bring inflation back down toward target, following a post-pandemic surge in
prices.
With inflation now falling in many of the world’s advanced
and emerging economies, attention has now turned to when they should start
cutting rates to stimulate investment and economic growth.
“Our team has looked back in history, and the conclusion
they drew is that the risk of premature easing is higher than the risk of being
slightly behind,” Georgieva told reporters during a briefing at the
International Monetary Fund in Washington.
“But don’t keep it tight if you don’t have to,” she said.
“So look at the data, act on the data.”
Georgieva’s comments come a day after the US Fed’s
rate-setting committee voted to hold interest rates steady. Fed Chair Jerome
Powell poured cold water on the idea of an interest rate cut at its next
meeting in March — sending stocks on Wall Street lower.
“I don’t think it’s likely that the committee will reach a
level of confidence by the time of the March meeting to identify March as the
time to cut,” he told reporters on Wednesday.
Earlier in the week, ECB President Christine Lagarde said
policymakers there were confident that rate cuts were coming, but would not
commit to a specific date.
Georgieva told reporters on Thursday that the United States
was close to achieving a so-called “soft landing,” when policymakers bring
inflation back to target without triggering a recession.
“We are poised for soft landing, it’s not done,” she said.
“You’re still 50 feet above ground and we know that until you land it’s not
over.”
AFP
0 comments:
Post a Comment