The International Monetary Fund (IMF) warned of escalating risks to global financial stability amid rising debt levels worldwide and ongoing fiscal pressures on governments. It revealed that global public debt is increasing rapidly and is expected to exceed 100 percent of global GDP by 2029.
According to the IMF, risks are leaning upward, meaning the likelihood of faster debt growth outweighs that of a slowdown. It also noted that changes in the macroeconomic environment since interest rate hikes began a few years ago have exacerbated fiscal pressures.
The report highlighted that the simultaneous increase in public debt and interest rates has raised the burden of interest payments on government budgets, as interest expenses climbed from around 2 percent of GDP in 2020 to nearly 3 percent now.
