International Monetary Fund (IMF) Managing Director Kristalina Georgieva said pandemic policy would remain a top economic policy for global leaders this year and protective measures needed to be taken around the globe in order to avoid continued disruptions.
“My main message is to recognize that the world must spend the billions necessary to contain COVID in order to gain trillions in output as a result,” she said.
“If we look at the reasons for inflation, it is not just for central bankers to fight it,” she said.Changing labor markets and other issues are also feeding into rising consumer prices, issues that policymakers in other areas would be better suited to address, she said.
Not everyone on the panel was in agreement, however.
“My fear is that the beast is out of the bottle. I don’t think inflation will be transitory at all,” Brazilian Economy Minister Paulo Guedes said. “I think these supply-adverse shocks will fade away gradually. But there’s no arbitrage on the western side to be exploited anymore. I think the central banks are sleeping at the wheel.”