Central banks need to push back against investor optimism to ensure price stability, IMF says, even if that means declines in stocks

• Central banks need to brace themselves against investor optimism and hold firm on monetary policy, per the IMF.
• The fund said price stability needed to be prioritized over a potential contraction in the stock market.
• The IMF pointed out that services inflation was unlikely to fall as quickly as price rises for goods.

Central banks will be forced to push back against surging investor optimism to keep prices from spiraling out of control again, the International Monetary Fund has said.