The Fund warns emerging companies due to the effect of a rise in the US rate.

The International Monetary Fund (IMF) returned to work yesterday, and on its first day of administration in 2022, it issued a severe warning regarding the modification of the world financial scenario, given the possible general impact of interest rates in the United States. The body managed by Kristalina Georgieva urged the economies of emerging countries, including Argentina, to prepare and contain the expansionary monetary policy in the face of the tightening of the monetary policy of the Federal Reserve (Fed). In a publication on the agency’s blog, the Fund stated that the greater inflationary pressure in the United States, the less expansive labor market than expected and the expansion of the omicrón variant and the consequent consequence on the world economy, provoke a more restrictive policy at the international level that must be taken into account by developing states. “Emerging economies should prepare for possible episodes of economic turbulence,” the Fund noted, recalling the risks posed by faster-than-expected Fed action and the new wave of the pandemic. According to the agency, “the faster increases in Fed rates could shake financial markets and tighten financial conditions worldwide. These developments could come with a slowdown in US demand and trade. And they can lead to capital outflows and currency depreciation in emerging markets. ” Given this, “emerging economies should prepare for possible episodes of global economic turbulence” since “those markets, with high public and private debt, exchange exposures and lower current account balances, have already registered movements of their currencies in relation to the dollar”. On the other hand, the agency assured that the prospects for solid growth in the United States together with a decrease in inflation could also begin to be seen this year, but that we will have to wait until this scenario is reached.