IMF : Global Interest Rates to Increase Until 2025, ASEAN Needs to Be Vigilant

IMF -  JAKARTA. The International Monetary Fund (IMF) predicts that global interest rates will remain high until 2024, and may even continue until 2025.

According to IMF Managing Director Kristalina Georgieva, the high global interest rates need to be watched by ASEAN countries, as they could cause significant losses.

“We predict that interest rates will remain high until 2024, possibly until 2025. This has consequences for ASEAN in terms of losses for many countries,” said Kristalina during the plenary session on three sub-themes of AIPF, Tuesday (5/9).

In addition, the budget financing issued in each country will be high, and will also impact the weakening of currencies, due to the increase in interest rates by The Fed and the European Central Bank.

Kristalina stated that global interest rates will still be high due to supply chain disruptions caused by the COVID-19 pandemic, and the war in Ukraine and Russia, which have put pressure on commodity prices.

“And inflation in most developed countries and many developing countries is falling but not enough,” she revealed.

However, Kristalina mentioned that ASEAN has now become a bright spot for the slightly dim global economy. Global growth this year is estimated at around 3%, while ASEAN is at 4.5% to 4.6%.

“This will continue until next year. Maintaining this growth momentum is very important,” she added.