IMF chief economist says rising U.S. debt level not a major concern

FILE PHOTO: Spanish Economy Minister Nadia Calvino and International Monetary Fund Chief Economist Gita Gopinath take questions at the annual meetings of the IMF and World Bank in Washington
FILE PHOTO: Spanish Economy Minister Nadia Calvino, left, and International Monetary Fund Chief Economist Gita Gopinath take questions at the annual meetings of the IMF and World Bank in Washington, U.S., October 18, 2019. REUTERS/James Lawler Duggan/File Photo

April 6, 2021

WASHINGTON (Reuters) – The growth of U.S. debt due to massive coronavirus aid spending is not a major concern for the International Monetary Fund, but fiscal support should be well-targeted to get the best economic effect, IMF chief economist Gita Gopinath said on Tuesday.

Gopinath told a news conference that the United States’ ability to service its debt had improved because of lower interest rates, so “just the level of debt at this point is not something we’re flagging as a major concern.”

Gopinath said the latest $1.9 trillion U.S. rescue package had improved the IMF’s global growth outlook, and pushed the U.S. recovery a couple of months ahead of the euro area.

(Reporting by David Lawder; Editing by Chizu Nomiyama)