International Monetary Fund

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"Global financial conditions have tightened notably" and downside risks to the economic outlook have increased as a result of the Russian-Ukraine war, according to the newly released Global Financial Stability Report (GFSR). The tightening has been "particularly pronounced" in eastern Europe and Middle East countries with close ties to Russia, reflecting lower equity valuations and higher funding costs, the IMF report was quoted as saying by Xinhua news agency.

The International Monetary Fund (IMF) will likely downgrade its global growth forecast next month due to spillover effects from the Ukraine crisis. The economic fallout of the ongoing crisis is being transmitted through three key channels to the rest of the world: higher commodity prices, the impact on real incomes and the real economy, as well as the impact on financial conditions and business confidence, Georgieva told reporters at a virtual media roundtable on Thursday.

The IMF's World Economic Outlook (WEO) kept the gross domestic product (GDP) growth forecasts it had made in July for India, whose Covid-battered economy had shrunk by 7.3 per cent in the last fiscal year. In July, while India was in the grip of Covid-19's second wave, the IMF had cut its forecast of 12.5 per cent made in April before the pandemic's resurgence by 3 per cent.

The Fund has also asked for withdrawal of sales tax exemptions to those whose revenue impact is in addition to 225 billion PKR, the sources said, adding that the final decision to accept or reject the demands would be taken during the policy level talks with the IMF set to begin in Washington on October 13.

"This is a historic decision, the largest SDR allocation in the history of the IMF and a shot in the arm for the global economy at a time of unprecedented crisis," Xinhua news agency quoted IMF Managing Director Kristalina Georgieva as saying on Monday. Noting that the SDR allocation will benefit all IMF members, address the long-term global need for reserves.

According to the Reserve Bank of India's (RBI) weekly statistical supplement, the reserves increased to $610.012 billion from $608.999 billion reported for the week ended June 25. India's forex reserves comprise foreign currency assets (FCAs), gold reserves, special drawing rights (SDRs), and the country's reserve position with the International Monetary Fund (IMF).

"The world is facing a worsening two-track recovery, driven by dramatic differences in vaccine availability, infection rates, and the ability to provide policy support," IMF Managing Director Kristalina Georgieva wrote in a blog on Wednesday, noting that it is a "critical moment" that calls for urgent action by the G20 and policymakers across the globe, Xinhua reported.

The IMF executive board on Friday discussed a proposal for a new SDR allocation of $650 billion, "the largest issuance in the IMF's history" aimed at helping its membership, especially the most vulnerable, overcome the Covid-19 crisis, Rice said in a statement at the end of the meeting. "The Board discussion is another step in the process toward a new SDR allocation which we expect to be completed by the end of August," Rice said.

"The coronavirus pandemic will not end until everyone has access to vaccines, including people in developing countries," World Bank Group President David Malpass and IMF Managing Director Kristalina Georgieva said in a joint statement to the Group of Seven (G7) industrialized countries, Xinhua reported.