Don’t celebrate too soon. That was the key message as policy makers and investors left Washington on Sunday after attending the annual meetings of the International Monetary Fund and World Bank.
IMF Managing Director Christine Lagarde urged officials to act now to build buffers for the next downturn. In that spirit, People’s Bank of China Governor Zhou Xiaochuan said given Chinese companies had taken on too much debt “we need to pay further effort to deleveraging and strengthen policy for financial stability.”
Politics could still spoil the party. Less than five miles away from the IMF meetings, Mexican and Canadian officials were absorbing tough proposals by the U.S. which could end up destroying the North American Free Trade Agreement.
U.K. Chancellor of the Exchequer Philip Hammond fought back calls from home for his resignation for being too gloomy about Brexit, while executives from JPMorgan Chase & Co. and Goldman Sachs Group Inc. warned they are preparing for the worst-case scenario. Catalonia may still try to leave Spain and Austrian nationalists are closing in on power after elections on Sunday.
The World Economic Forum estimates the globe needs $2.5 trillion more in financing to reach the United Nations’s sustainable development goals.