IMF urges fiscal caution as global debt surges to record

The IMF in June downgraded its outlook for the coronavirus-ravaged world economy, projecting a significantly deeper recession of 4.9% this year, the biggest slump since the Great Depression.

RIO DE JANEIRO: The International Monetary Fund (IMF) has urged governments to exercise fiscal caution as they borrow more to support economies hit by the Covid-19 pandemic, saying debt levels could soar to a record this year.

“The need for continued fiscal support is clear, but this begs the question of how countries can finance it without debt becoming unsustainable, ” Fiscal Affairs Department director Vitor Gaspar and Gita Gopinath, the fund’s chief economist, said in a blog Friday.