IMF fiscal chief: U.S., China must rein in debt, face different challenges

The U.S. and China will both need to make major changes to put their medium-term debt and deficit on a sustainable path, International Monetary Fund Fiscal Affairs Director Vitor Gaspar said on Wednesday. The U.S. and China are fueling a projected return to higher debt levels after two years of falling debt-to-GDP ratios as a post-COVID growth surge fades. "If you look at what is exactly driving the U.S. and China, you would say it's large and persistent budget deficits on the order of 6% to 7% of GDP throughout the period up to 2028," Gaspar said.