IMF chief says global prices will take time to recede after war

[NEW YORK] Global prices will take time to come down to levels seen before the US-Israeli war with Iran even if a ceasefire holds, International Monetary Fund (IMF) managing director Kristalina Georgieva said.

“It will take some time, yes, and it will take more time for locations that are experiencing higher degree of disruption,” Georgieva said in comments aired on Sunday (Apr 12) on CBS’s Face the Nation ahead of this week’s spring meetings of the IMF and the World Bank. “That’s why we need to remember the asymmetry of this shock.”

Georgieva reiterated that the IMF will lower its global growth forecast as a result of the war in Iran.

“We are going to have a downgrade, and the size of this downgrade will depend on these two things, duration and speed with which everything can come back to the same level of production that we had before,” she said.

US President Donald Trump said on Sunday that the US will begin a full naval blockade of the strategic Strait of Hormuz and threatened to retaliate in the event of Iranian resistance. Trump’s announcement came hours after the US and Iran failed to reach a deal during direct talks in Pakistan, raising doubt about prospects for the ceasefire announced last week to hold as well as a permanent end to the war. BLOOMBERG