Too soft US fiscal policy threatens the economy of the country and the world - IMF

 The International Monetary Fund (IMF) has expressed concern over the too soft fiscal policy of the United States and believes that it may complicate the task of reducing inflation to the target of 2%, the report of the fund says.

The high and volatile yield of US government bonds can affect the situation in other countries and lead to a tightening of financial conditions, the organization also warned.

In 2023, the US budget deficit was 8.8% of GDP, compared to 4.1% of GDP in 2022. The IMF predicts that the deficit will exceed 6% of GDP in the medium term, and the situation is not expected to improve in the near future, as government spending tends to increase and tax revenues decrease during presidential election years.

The US government should soon start thinking about the reform of the social assistance system and other tough measures for a more balanced budget, and it should also pay attention to the excess profits of companies to increase revenues, the IMF notes.

The day before, the fund improved the growth forecast of the American economy for the current year to 2.7% from 2.1%, for 2025 - to 1.9% from 1.7%.