IMF's Optimistic Inflation Forecast Boosts Confidence

International Monetary Fund Managing Director Kristalina Georgieva shared a more optimistic forecast for U.S. inflation compared to the Federal Reserve's projection. She cited a potential subsiding of the post-pandemic consumer spending boom as a key reason. Georgieva expressed confidence that inflation will hit the Fed's 2% target by 2025.

International Monetary Fund Managing Director Kristalina Georgieva said on Thursday that the IMF's forecast for U.S. inflation is somewhat more optimistic than the Federal Reserve's own forecast in part because the country's post-pandemic consumer spending boom may be subsiding.

Georgieva told reporters after issuing a statement on the IMF's annual review of U.S. economic policies that the trajectory of U.S. inflation gives the IMF confidence that inflation will return to the Fed's 2% target in 2025, earlier than the Fed's own forecast of 2026.

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