Fiscal Policy Can Promote Economic Stability and Address Risks to Public Finances by Francesca Caselli, Vitor Gaspar, Gee Hee Hong, Paulo Medas published by IMF (4/2023).
“Following exceptional pandemic support, governments should foster disinflation and financial stability while protecting the most vulnerable and safeguarding public finances
Three years since the outbreak of the pandemic, fiscal policy has moved a long way toward normalization. Governments have withdrawn exceptional fiscal support, and public debt and deficits are falling from record levels. That’s happening amid high inflation, rising borrowing costs, a weaker growth outlook, and elevated financial risks. Debt sustainability is a cause for concern in many countries.
Our latest Fiscal Monitor discusses how exceptional economic conditions since the pandemic have shaped fiscal outcomes. It calls for consistent policies to bring inflation back to target, address public finance risks while protecting the most vulnerable, and safeguard financial stability…”
