FX.co ★ IMF Flags Mixed Global Inflation Ahead of October Outlook

The upcoming World Economic Outlook from the International Monetary Fund (IMF), scheduled for release on October 14, will analyze the repercussions of tariffs on the U.S. economy and inflation, as revealed by IMF spokesperson Julie Kozack on Thursday. Kozack highlighted a "mixed global picture": while certain tariffs are contributing to core inflation in the U.S., headline inflation is escalating more rapidly in the UK, Australia, and India, yet remains "very muted" in China and other Asian exporting nations due to subdued demand. Companies in the U.S. and other countries implementing tariffs have largely absorbed the increased duties, thereby limiting the inflationary impact thus far. She mentioned that although global growth was stable in the first half of the year, it is now beginning to slow. Regarding monetary policy, Kozack affirmed that the Federal Reserve's rate cut in September was fitting, considering the softening labor market and inflation aligning with targets, albeit with persisting upside risks. Additionally, she emphasized that the IMF is closely observing the consequences of the partial U.S. government shutdown.