IMF Says Global Debt Fell As Share Of GDP In 2022, May Resume Rising Trend

• The International Monetary Fund (IMF) on Wednesday said that the global debt as a share of economic output fell significantly in 2022 for the second year in a row, but the decline may be ending as post-COVID growth picks up pace.
• The IMF said in an update to its Global Debt Database that the world's total debt-to-GDP ratio fell last year to 238% from 248% in 2021 and 258% in 2020. However, the decline for the past two years, driven by strong growth and stronger-than-expected inflation, has recouped only about two-thirds of the COVID-induced spike in global debt. The ratio remains well above the 2019 level of 238% of GDP.
• China has played a central role in increasing global debt in recent decades as borrowing outpaced economic growth, and its debt burden has defied the moderating trend, growing to 272% of GDP in 2022 from 265% in 2021. Those levels are similar to the United States, which saw its total debt-to-GDP ratio fall to 274% in 2022 from 284% in 2021, according to the IMF report.
• The world has been on a debt "rollercoaster" for three years, but debt is likely to rise again over the medium term, and the IMF urged governments to adopt strategies to help reduce debt vulnerabilities -- both in public debt, household debt and non-financial corporate debt.

(Source: Reuters)