Advanced economies must 'act now' to lower debt as bond yields spike: IMF
Summary
The IMF has urged advanced economies to act now to curb rising debt as bond yields surge to multi-decade highs and borrowing costs climb. The fund warns that delaying fiscal consolidation will make it harder for governments to manage spending pressures, interest payments and broader financial risks.
Key Points
- Global public debt is at its highest level since World War II and is on track to exceed 100 percent of global GDP.
- The IMF says advanced economies must begin fiscal consolidation now as bond yields and borrowing costs rise sharply.
- US and other G7 bond yields have climbed to levels not seen in decades, driven by inflation expectations and energy-price shocks.
- The IMF warns that higher yields in advanced economies could spill over into emerging markets and make debt management more difficult.
