Central banks around the world should keep battling inflation by hiking interest rates despite ongoing concerns about financial stability, the head of the International Monetary Fund told AFP on Thursday.
Since last year, central banks have been raising their benchmark lending rates to tackle inflation, which rose to levels not seen for decades in many countries including the United States.
But their fight has been complicated by the recent collapse of Silicon Valley Bank after taking on too much interest-rate risk, setting off a period of turbulence in the banking sector on both sides of the Atlantic.
“We don’t envisage, at this point, central banks stepping back from fighting inflation,” IMF managing director Kristalina Georgieva said in an interview ahead of the fund’s spring meeting next week.
“They have to stay the course in a much more difficult, more complex environment,” she said.
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