IMF Chief Georgieva Says The World Is In A Recession, Containment Will Dictate Strength Of Recovery

International Monetary Fund chief Kristalina Georgieva said Friday that the global economy is now in a recession thanks to COVID-19, but that she's heartened to see world leaders finally realizing that only a coordinated effort will be able to stem the spread of the novel coronavirus.

"We have stated that the world is now in recession and that the length and depth of this recession depend on two things: Containing the virus and having an effective, coordinated response to the crisis," she told CNBC's Sara Eisen

"I'm very encouraged by what I see now. I see much clearer understanding [among global leaders] that if we don't beat it everywhere we won't be able to get out of it," she added.

"We should not go ... with small measures now when we know that it is a gigantic crisis," she said minutes later. "We've never seen the world economy standing still. Now we [do]. How we go about revitalizing it is another important topic."

The IMF has taken extraordinary measures in recent weeks to help combat the economic toll COVID-19, and efforts to contain its spread, has had on economies around the globe.

On March 16 the international body said it "stands ready" to use its $1 trillion lending capacity to help countries around the world that are struggling with the humanitarian and economic impact of the novel coronavirus.

Georgieva wrote at the time that such support could be used to aid its members, especially emerging and developing countries. The IMF's Catastrophe Containment and Relief Trust "can help the poorest countries with immediate debt relief, which will free up vital resources for health spending, containment, and mitigation."

Her comments came near the end of yet another violent week on Wall Street, with the S&P 500 down nearly 3% in midday trading in New York. Both the S&P 500 and Dow industrials are up more than 10% this week, however, after the Federal Reserve moved to pump cash into the U.S. economy through historic easing policies and zero-interest loans.

American investors also found relief in moves by Congress toward a massive, $2 trillion stimulus package that, if passed, would provide millions of citizens with quick infusions of cash among other provisions.

The S&P 500 and Dow Jones are each down at least 25% from their all-time highs hit as recently as February.

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