@everyone

IMF Warns of Impact of Trump's Policies on Global Interest Rates

The International Monetary Fund (IMF), an international financial institution, revealed that the threat of trade tariffs from US President-elect Donald Trump has triggered an increase in long-term interest rates globally, and shaken world markets.

Although he has not officially returned to the White House until January 20, Trump's trade policies have begun to create uncertainty that has had a broad impact on the economy.

Managing Director at the IMF Kristalina Georgieva said this situation was very unusual because there was a decrease in short-term interest rates along with a spike in long-term borrowing costs. She also highlighted the major risks for developing markets due to rising US bond yields and a strengthening dollar that burdens their borrowing costs.

Meanwhile, Europe is preparing to face the threat of a new trade war from Trump's policies. Industry Chief European Union (EU) Stephane Sejourne stated that he was ready to take defensive and offensive steps to protect their industries from the impact of unfair tariffs.

The IMF warned that trade tensions could reduce global economic growth by up to 0.5 percent. Amid the post-pandemic economic slowdown, this impact is considered to worsen the situation, especially for low-income countries and emerging markets that are more vulnerable to economic turmoil.

-# Image Source: Daily Sabah