The International Monetary Fund (IMF) has cautioned that the underlying causes of historically high inflation could persist until 2025.
The IMF’s chief economist, Pierre-Olivier Gourinchas, pointed out that inflation remains high in many countries despite concerted efforts by central banks to slow down price increases by raising interest rates.
Gourinchas stated that the persistence of core inflation could result in central banks having to maintain higher interest rates for a longer period. This move would add to the financial sector’s existing strains, rocked by the dramatic collapse of Silicon Valley Bank last month.
Additionally, Gourinchas identified real estate as another sector of concern due to the slow post-pandemic return to offices in many cities worldwide. He urged countries without fiscal tools to tackle inflation to be cautious, advising them to reinforce areas that appear weak