Trade war is tougher threat than COVID for emerging market cenbanks, IMF says

The shock from trade war brings differential effects for central banks in emerging markets, in contrast with the COVID pandemic, when they could quickly ease monetary policy, the International Monetary Fund’s (IMF) Gita Gopinath said.

In an interview with the Financial Times newspaper, the fund’s first deputy managing director said the unpredictable impact of tariffs on developing economies and global markets would make the task of their central bankers harder.

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“This time the challenge is going to be greater for them, compared to the pandemic,” she said.