The IMF chief said the US cannot rely on growth alone to reduce its soaring deficit and debt, urging fiscal measures as federal debt tops $40 trillion and borrowing costs stay high.
01Summary
- 01Kristalina Georgieva said on Wednesday in Bangkok that growth helps but cannot deliver the needed budget adjustment fast enough.
- 02She said Treasury Secretary Scott Bessent and US authorities are relying too much on strong growth and need fiscal measures to improve the budget balance.
- 03US public debt has passed $40 trillion and federal debt is above 100% of gross domestic product.
- 04The IMF expects US growth of 2.3% in 2026 and 2027 and projects gross government debt to reach 142% of GDP by 2031.
- 05Benchmark 10-year US Treasury yields were around 5.2% on Wednesday, near their highest level since 2002.
02Why it matters
The warning underlines that the US debt burden is still worsening even with solid growth, which can affect Treasury markets and future borrowing costs. It also matters because the IMF is pressing for policy action rather than relying on optimistic growth forecasts.
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