IMF Projects Global Inflation to Decline Amid Economic Resilience

Global inflation is anticipated to decline to 3.5% by the end of 2025, largely due to a resilient global economy, as reported by the International Monetary Fund (IMF).

After reaching 9.4% in Q3 2022, inflation is nearing central bank targets, with growth projected to stabilize at 3.2% for 2024 and 2025.

This reduction could lower living costs and interest rates, benefiting risk assets like cryptocurrencies.

However, IMF Chief Economist Pierre-Olivier Gourinchas warned of potential risks from geopolitical tensions, especially in the Middle East, and uncertainties surrounding the U.S. presidential election.

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Despite positive forecasts, the IMF called for policy reforms related to interest rates, government spending, and productivity to sustain growth. While the U.S. is expected to lead growth, advanced economies in Europe may experience slowdowns due to escalating global conflicts.

In contrast, billionaire hedge fund manager Paul Tudor Jones expressed concerns about rising inflation, citing the U.S. government’s significant debt and projected fiscal deficits. He suggested that inflating out of debt, similar to Japan’s strategy, might be necessary to address spending issues and avoid financial instability.

Alexander Stefanov