The International Monetary Fund's chief economist said on Thursday that central banks do not have the room to keep monetary policy loose and interest rates low.

IMF Chief Economist Gita Gopinath stated at a World Health Organization (WHO) event on funding for vaccines and other tools to combat the COVID-19 pandemic that "We are now in the phase where countries around the world just don't have the space to keep monetary policy very loose, to kind of keep interest rates extremely low. We are seeing inflationary pressures building up around the world."

"And so think of a situation where you could have this pandemic last longer, you have longer supply disruptions that are putting inflationary pressures, and then we have the real risk of something we have avoided so far, which is stagflationary concerns," Gopinath added.

IMF proposes Gita Gopinath for first deputy MD post - Central Banking