Central Banks Are Out Of Ammo – UN Head Demands Immediate Fiscal Stimulus To Save World From Crisis
More and more global leaders sound the alarm that the world economy is headed for a difficult period in 2020.
Unlike several years ago, leaders across the world are now calling for immediate deployment of fiscal stimulus, but not monetary stimulus, a sign that central banks are out of ammunition to combat the next economic crisis.
UN Secretary-General António Guterres warned that the global economic outlook is facing severe headwinds, and the international community must quickly act to “do everything possible” to prevent the world from “fracturing,” mostly due to the US and China trade war.
Guterres spoke on Saturday at the World Bank Group and IMF Annual Meetings in Washington, DC.
He said that “during tense and testing times,” he “fears the possibility of a Great Fracture – with the two largest economies splitting the globe in two – each with its own dominant currency, trade and financial rules, its own internet and artificial intelligence capacities and its own zero-sum geopolitical and military strategies.”
He told international bankers that “it is not too late to avoid” this fracturing of the world, but “we must do everything possible to avert this…and maintain a universal economy with universal respect for international law; a multipolar world with strong multilateral institutions, such as the World Bank and IMF.”
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