IMF warns US must tackle its yawning deficit

{"text":[[{"start":9.2,"text":"The US’s yawning deficit is set to remain the widest among the world’s richest countries despite revenues from Donald Trump’s trade tariffs, with the IMF warning the world’s largest economy needs to put its finances in order “sooner rather than later”."}],[{"start":28.14,"text":"The IMF’s latest Fiscal Monitor showed the US’s general government overall balance — a measure which includes interest payments on debt holdings — was set to be the highest of any rich nation tracked by the fund for this year and the rest of the decade."}],[{"start":46.09,"text":"The US, unlike most other rich nations, is not expected to make any progress in lowering its deficit from current levels. The country’s gross debt-to-GDP ratio, expected to be 125 per cent of GDP this year, will surpass record highs to hit 143 per cent by the end of the decade, according to the IMF’s latest projections."}],[{"start":74.49000000000001,"text":"As finance officials from around the world meet in Washington for the IMF’s annual meetings, Vítor Gaspar, the outgoing head of the fund’s fiscal department, called on US lawmakers to “adjust sooner rather than later”."}],[{"start":null,"text":"

"}],[{"start":92.17000000000002,"text":"Bringing deficits and debts under control would “reduce pressure on interest rates”, contributing to the health of global financial markets, and create more space for technology spending by the private sector, financing “what is, at this point in time, an investment boom in the United States”, Gaspar said."}],[{"start":113.07000000000002,"text":"The US has traditionally been able to borrow at more favourable rates than other rich countries owing to the dollar’s role as the global reserve currency, backed by the size and liquidity of the US Treasury market."}],[{"start":129.32000000000002,"text":"However, a bigger gap between governments’ shorter and longer-term borrowing costs — both in the US and elsewhere — signals investors are becoming more concerned about markets’ appetite for more lending to governments."}],[{"start":145.86,"text":"The IMF expects global government debt to exceed 100 per cent of GDP in 2029."}],[{"start":155.21,"text":"While Trump’s tariffs do little to shrink the US deficit, without the trade revenues the US fiscal deficit would expand dramatically. The current administration’s reconciliation bill, dubbed the ‘One Big, Beautiful Bill’, extends tax cuts enacted during the US President’s first term in the White House."}],[{"start":178.09,"text":"The Congressional Budget Office thinks the bill will add $4.1tn to US deficits over the next decade — with tariff revenues set to lower deficits by $4tn."}],[{"start":194.83,"text":"The IMF does not provide a breakdown of what it believes the impact of both the bill and tariffs will be. But Gaspar said the revenue provided by the tariffs was “significant, but clearly not enough to bring the deficit in the US significantly down and put the path of public debt under control”."}],[{"start":217.53,"text":"Gaspar said US lawmakers had an “ample range of policy options . . . to put a lid on debt.”"}],[{"start":233.25,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1760571563_8218.mp3"}