IMF Managing Director Krisztalina Georgieva praised Federal Reserve Chair Kevin Warsh for prioritising price stability amid rising inflation and urged highly indebted countries, including the United States, to take immediate fiscal action.
Fed’s focus on inflation highlighted
Georgieva said the Fed chair sent a clear signal that price stability is central to its policy stance, supported by both words and actions. The US central bank raised its policy rate last month for the first time since July 2023, despite pressure from US President Donald Trump to reduce borrowing costs.
The Fed aims to achieve price stability, defined as an average inflation target of around 2 percent, and to ensure full employment.
Calls for debt reduction in several countries
The IMF chief praised US finance minister Scott Bessent for comments on reducing the budget deficit, while stressing that the United States alongside France, Japan, and Italy should take concrete steps to reduce high public debt and deficits. Germany was cited as an encouraging exception due to decades of fiscal discipline.
Georgieva also highlighted concerns regarding uneven growth in artificial intelligence, a prolonged energy crisis, and record-level debt in a speech the same day.
Also Read
Market context and policy outlook
The US federal funds rate stood at 3.88 percent as of 5 October 2026, its highest in 31 days. This follows the Fed’s recent rate increase aimed at curbing inflationary pressures. The US 10-year Treasury yield was 5.31 percent at the close on 5 October.
Related: Fed rate hike odds climb to 70 percent on oil and data · Sucor sees 60% chance of Fed rate hike in September
Source: IMF | Data: FRED — St. Louis Fed · U.S. Department of the Treasury
