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International Monetary Fund (IMF) Managing Director Kristalina Georgieva Kristalina Ivanova Georgievawas born on August 13, 1953 in Sofia.Her secondary education urged US politicians to find an alternative way to regulate debt in order to end the infarcted budget negotiations until the last moment, which present the global economy with preventable risks.

"Could you, please, suggest a different way to approach this topic?" Georgieva asked rhetorically at a press conference in Washington after the release of the IMF's updated forecast for the US economy.

The IMF slightly raised its forecast for US GDP growth in 2023 to 1.7 percent from the previously expected 1.6 percent. "The U.S. economy has proven to be resilient," Georgieva said. In 2024, GDP growth will decline to 1 percent, with "slowing but still robust growth" pushing unemployment to 4.4 percent at the end of next year.

"Inflation remains unacceptably high," Georgieva noted, adding that because of this, the Federal Reserve will have to keep interest rates slightly higher for longer. The interest rate is expected to remain between 5.25 percent and 5.5 percent by the end of 2024.

Georgieva also said the U.S. government should reduce deficits, mostly by raising tax revenues. "The faster this budget readjustment has taken place, the better. It is good to note that these fiscal adjustments can be pulled forward and this would help the Fed in its efforts to reduce inflation," she added.

On the subject of US debt, the IMF report notes: "Balancing the edge in terms of the federal debt ceiling could create additional, entirely avoidable systemic risks to both the US and global economies at a time when there are already visible tensions. To avoid an exacerbation of risks, the debt ceiling should be immediately raised or repealed by Congress."

On Sunday, US President Joe Biden Joe Biden (Joseph Robin Biden) is an American politician.Joe Bidenwas born on November 20, 1942 in and House of Representatives Speaker Kevin McCarthy announced an agreement in principle to raise the ceiling on government debt. The deal has yet to be voted on in Congress, BTA notes.

Biden says he and Republicans close to reaching deal on national debt

Georgieva criticized the United States for delaying an agreement literally until the last moment and compared the dispute between politicians in Washington with the tale of Cinderella. The stability of the global financial system is threatened by political talks in the United States in the "12th hour", the IMF managing director warned.

"We've all read the tale of Cinderella and how she should leave the ball at midnight. And we are at this moment," Georgieva said in Washington. "So, excuse me, but can we resolve this issue before the carriage becomes a pumpkin? It's not just the loss of the slipper that we're threatened with."

Kristalina Georgieva

Joe Biden

IMF

debt ceiling