As the global economy faces mounting pressures, International Monetary Fund Managing Director Kristalina Georgieva urged governments to address growing fiscal challenges and central bankers to stay committed to lowering inflation.

“All countries need to tackle their fiscal problems and formulate and present credible plans to ensure their debt and deficits are on sustainable path,” Georgieva told reporters in prepared remarks Tuesday at the lender’s Washington-based headquarters. “Central banks must be laser focused on their price stability mandates,” she added.

The world economy has so far been resilient in the face of stubborn inflation and trade tensions, thanks in part to soaring investments in artificial intelligence, Georgieva said. But uncertainty about the outlook remains high, as evidenced by rising bond yields and the lack of progress on bringing down inflation, she added.

The energy shock stemming from the conflict in Iran isn’t over, Georgieva also said. “In short, we have literally a tug of war between the negative supply shock from the Middle East and the positive demand shock from AI.”

The IMF will hold its annual meetings in Bangkok in October, when the lender is expected to release its latest assessment of the global economy. Back in July, the fund left its growth projection mostly unchanged at 3 percent in 2026, but increased its forecast for global consumer prices, mainly due to energy and food costs.

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Among the risks to the outlook, Georgieva cited shrinking oil and gas reserves as the Northern Hemisphere heads into the winter, a harsh El Nino weather pattern that would increase food insecurity and the impact of AI on financial stability.

“All this leaves no room for complacency, and that is my core message. We have not done very badly, but that should not be a source of saying, ‘Okay, everything is hunky-dory, it’s easy’,” she said.

Georgieva will this week attend the Federal Reserve’s annual economic symposium in Jackson Hole, Wyoming, for the first time. Fed Chairman Kevin Warsh will deliver his first major speech since taking the helm of the central bank, with investors looking for clues on the future path for interest rates.

Speaking about an undergoing surveillance review conducted at the IMF, Georgieva said the lender is “looking for greater use of scenarios and contingency planning to help countries be more nimble in a world of more uncertainty”.