The Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, has emphasized the importance of central banks maintaining their independence amid ongoing inflationary pressures and global economic uncertainty.
She highlighted the need for Central Bankers to closely monitor key economic indicators, particularly inflation expectations, in order to safeguard price stability.
Georgieva also stressed the urgency of strengthening financial regulations, increasing oversight of risks within the non-bank financial sector, and taking proactive steps to ensure debt sustainability—especially for low-income countries grappling with limited fiscal space and revenue shortfalls.
“To protect price stability, monetary policy must remain agile and credible, supported by a strong commitment to central bank independence. Central bankers must keep an eagle eye on the data, including higher inflation expectations in some cases or inflation dropping in others. In finance, strong regulation and supervision remain essential to keep banks safe, and rising risks from non-banks must be monitored and contained,”
“Emerging market economies should preserve exchange rate flexibility as a shock absorber. Policymakers can look to the IMF‘s integrated policy framework for insights on how and when temporary measures may be warranted.”
“Tighter budget constraints will entail difficult choices everywhere, but nowhere more so than in low-income countries. Here, weak revenues necessitate stronger efforts for domestic resource mobilization, but also call for support from international partners, both to improve capacity for reforms and to secure critical financial assistance. Countries with unsustainable debt should move proactively to resolve sustainability”.
