IMF, World Bank meetings begin but what’s on the agenda?
The annual meetings of the International Monetary Fund and World Bank kick off this week against a backdrop of escalating global conflict and debt distress.
A new outbreak of violence in Israel and the grinding war in Ukraine add a grim dynamic to the Washington-based lenders’ efforts to rally their members and keep the focus on reforms to bolster their financial firepower.
The gatherings in Marrakech, Morocco — which bring together the world’s finance ministers, central bank governors and top commercial banking executives — are taking place in Africa for the first time in 50 years. Kenya’s capital, Nairobi, was host in 1973, the same year as the Yom Kippur War in the Middle East. Like the current violence, that conflict caught Israel by surprise at a time of global economic fragility.
The confluence of issues, amid high interest rates and a cautious economic outlook, reminds the estimated 10,000 attendees “how quickly geopolitics can change their calculations,” said Josh Lipsky, senior director of the GeoEconomics Center at the Atlantic Council.
Here’s what to watch for this week:
The global economy has been buffeted by inflation, the steepest monetary tightening in a generation, China’s property crisis and Russia’s invasion of Ukraine, yet expansion keeps chugging along. That has markets rushing to price in a higher-for-longer interest-rate outlook, with 30-year US Treasury bond yields last week punching through 5% for the first time since 2007.
In its flagship World Economic Outlook on Tuesday, the IMF lifted its global inflation forecast for next year — 5.8% from 5.2% seen in July — while shaving 0.1% off its growth outlook for 2024, to 2.9%.
“Monetary policy needs to remain tight in most places until inflation is
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