IMF members warn rising bond yields could amplify risks as delegates walk out on Russia's finance minister

The International Monetary Fund's steering committee warned on Saturday that rising government bond yields in major economies could amplify financial risks and urged countries to rein in budget deficits, in a statement all members agreed to even as nearly a dozen delegates walked out when Russia's finance minister spoke.

What the members signed

The statement, issued on Saturday in Bangkok by the committee's chair, Saudi Finance Minister Mohammed Aljadaan, at the close of the IMF and World Bank annual meetings, says the global economy has come through the latest run of shocks better than expected but that "buffers have been eroded, and resilience cannot be taken for granted." The IMF published it as press release 26/340, under the line "IMFC members agreed on the following text."

The committee said risks "remain tilted to the downside." It named two sets of threats. One is physical: escalating conflicts and trade tensions that could further disrupt critical trade routes, push up commodity prices, including refined energy products, and worsen energy and food insecurity. The other is financial: "Rising sovereign bond yields in systemic economies," along with high public debt, heavy refinancing needs and uncertainty over how advanced artificial-intelligence technologies will affect the economy and financial system, "could amplify macro-financial vulnerabilities."

That language lands in a market where borrowing costs are already the story. The benchmark 10-year U.S. Treasury yield was above 5% on Friday, after stronger-than-expected U.S. inflation data this week lifted bets on another Federal Reserve rate increase.

The policy asks

Members said fiscal vulnerabilities "should be urgently addressed" and that budget consolidation should move ahead under credible medium-term plans, while protecting the most vulnerable people and investment that drives growth. They said central bank independence "remains essential for policy credibility and keeping inflation expectations anchored," and that central banks would keep adjusting policy based on data.

The text also stresses "secure and resilient energy flows" and "the principle of freedom of navigation" as essential to global stability. It welcomes a "Bangkok Blueprint" on digital-finance safeguards, cyber resilience and digital fraud, and asks members to finish domestic approvals for the IMF quota increase agreed under the 16th General Review of Quotas "with no further delay." Members also backed a one-year extension of Aljadaan's term as chair.

The walkout

The agreed wording masked a visible split in the room. Delegates walked out of a committee session when Russian Finance Minister Anton Siluanov began speaking in Russian, Reuters reported, citing three sources. Nearly a dozen left the room, and delegates from Denmark, Sweden, Finland, Norway, Lithuania, Latvia and Estonia were among them, one official told the news agency. Interfax-Ukraine quoted Andriy Pyshnyi, governor of the National Bank of Ukraine, as saying he stood up and left during Siluanov's remarks and that a large group of officials and ministers followed him. The agency said it was Siluanov's first IMFC meeting since Russia's full-scale invasion of Ukraine in February 2022.

Aljadaan played down the protest. "Look at this chair statement, it clearly says that all members agreed to the statement, so that's what matters," he told Reuters after a press briefing.

Siluanov's written statement to the committee, submitted on behalf of Russia and Syria, made a different set of points. It argued that the Fund should pay more attention to the policies of countries that issue reserve currencies and warned of a growing risk that advanced AI technologies will be monopolized, saying they should benefit a broad range of countries rather than "become an instrument of economic policy."

What it means for poorer borrowers

At the same briefing, IMF Managing Director Kristalina Georgieva said the meetings were marked by "both optimism and worry," according to AFP. She said higher global interest rates were pushing up debt payments for low-income countries, whose debt service has climbed from 8% to 14% of government revenue in recent years. "Inflation is like a tax on the poor," she said.

The committee's statement points the same way. It calls for more support for countries with sustainable debt and solid reform plans that face short-term financing problems, and for more timely and predictable debt restructurings, including under the Common Framework.

The committee's next meeting is expected in April 2027 in Washington.