## Development Committee: The Managing Director's Written Statement October 2022

_Policy Papers, October 14, 2022_

## Source details

**Canonical URL:** [Development Committee: The Managing Director's Written Statement October 2022](https://www.imf.org/en/publications/policy-papers/issues/2022/10/15/development-committee-the-managing-director-s-written-statement-october-2022-524862)

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## Bibliographic details
- Published: October 14, 2022
- Series: Policy Papers
- DOI: https://doi.org/10.5089/9798400221491.007

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### Global outlook and simultaneous shocks
- Several simultaneous shocks are weighing on the global economic outlook and complicate policymaking.
- Inflationary pressures are on the rise and increasingly broad based.
- Russia’s war in Ukraine continues to send shockwaves through the global economy, including by disrupting commodity markets and contributing to higher sovereign risk spreads.
- Lower growth in China as a result of lockdowns and a weaker housing market curtails global demand.
- Climate change is generating increasingly costly extreme weather events.
- The combination of lower growth and high prices squeezes household budgets.

### Impact on households and Emerging and Developing Economies (EMDEs)
- Households in low-income developing countries (LIDCs) are especially squeezed where hard-to-replace spending items, such as food, account for a large share of consumption.
- EMDEs need to cope with less favorable financial conditions and weaker currencies that raise the domestic currency value of foreign debt.
- These factors create a constellation that contains potential for wider debt distress.

### Policy trade-offs and priorities
- Central banks face difficult policy trade-offs, as both over- and under-tightening the monetary stance would come with significant costs.
- Policymakers should focus on:
  - Gaining control over inflation,
  - Preserving financial stability,
  - Using focused and well-targeted fiscal interventions to support those most in need.

### Global cooperation and risks
- Global cooperation is more important than ever.
- Geopolitical developments pose an acute threat to global cooperation.

*Development Committee: The Managing Director's Written Statement October 2022*

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## Content in this bundle

- **Policy Paper**
  - [Policy Paper (PDF)](/-/media/files/publications/pp/2022/english/ppea2022047.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/policy-papers/issues/2022/10/15/development-committee-the-managing-director-s-written-statement-october-2022-524862_