The IMF reiterated that it views global inflationary pressure as “transitory,” but that there are risks that it may become more sticky spokesman Gerry Rice told reporters Thursday in Washington, DC.
“Just taking the global perspective first, our view is that the spike in inflationary pressures that we have seen reflects transitory supply demand mismatches, temporary input shortages and largely one-off shifts, including commodity price increases coming off the very low base of last year,” Rice said.
Rice said the the IMF is ‘watchful’ for now, and expressed confidence in the US Fed’s ability to navigate the inflationary pressure.
“The actions taken by the Federal Reserve, we believe, will help support the US economy and more firmly anchor inflation expectations. The Fed's continued clear communication and its commitment to an orderly, methodical, transparent messaging of its policy intentions will help mitigate potential risks arising from policy normalization,” he said.
He also confirmed that there will be high-level meetings with Argentine officials during the G20 meetings in Italy in July.
“In terms of the question about payments to the IMF. Argentina has indicated its commitment to meeting its obligations to the Fund and. To this end, we're working closely with the government toward a new program. As I've said here, as I've said here before, which does sort of bring me to the status of those discussions, we continue to be engaged, looking to help Argentina and the people of Argentina as much as we as much as we can facing the challenges of the pandemic and the social economic challenges they face,” Rice said.
And Pakistan was unable to complete its Sixth Review of its program with the IMF, Rice said. But talks continue and the Fund has made it clear that further reforms are needed to ensure sustainable and inclusive growth there, Rice clarified.
“As the recovery gains strength, it's it will be important to accelerate the implementation of policies and reforms needed to address some of the long standing challenges facing the Pakistani economy and while the recent mission could not complete these discussions, we remain fully engaged with the authorities aiming to resume the discussions in in the period ahead.”
See the full transcript at IMF.org