WASHINGTON (Reuters) -The International Monetary Fund’s steering committee on Thursday urged global policymakers to monitor pricing dynamics closely, but to “look through” inflationary pressures that are transitory and will fade as economies normalize. The International Monetary and Financial Committee (IMFC), made up of 24 finance ministers and central bank governors from IMF member countries, said in a final communique here that governments should "carefully calibrate" domestic policies to an evolving pandemic. “We will continue to prioritize health spending and protecting the most vulnerable, while shifting focus, as appropriate, from crisis response to promoting growth and preserving long-term fiscal sustainability,” they said. Inflation concerns, stoked by pent-up demand, supply chain bottlenecks, higher energy and commodity prices and weather events have been a hot debate topic at IMF and World Bank annual meetings this week, and contributed to the Fund trimming its global growth outlook here on Tuesday. “Central banks are monitoring price dynamics closely and can look through inflation pressures that are transitory. They will act appropriately if risks of inflation expectations de-anchoring become concrete,” the IMFC said, a reference to the banks using monetary policy tools to control inflation. The language was toned down from an earlier draft that called for central banks to be ready to take “decisive actions to maintain price stability.” TRANSITORY OR DURABLE? Policymakers are wrestling with the inflation question as wealthy countries move beyond the pandemic to recovery, while developing economies struggle with COVID-19 variants, low vaccine access and a lack of resources. An abrupt tightening of monetary policy in the United States or Europe could prompt devastating fund outflows from developing countries, the IMF has warned. “The key question is to know whether this is a transitory inflation or not. Nobody has a response to that key question,” French Finance Minister Bruno Le Maire told reporters on Thursday, adding that he’s been discussing it this week with U.S. Federal Reserve Chairman Jerome Powell, U.S. Treasury Secretary Janet Yellen and European Central Bank President Christine Lagarde. Magdalena Andersson, the Swedish finance minister who chairs the IMFC panel, told a news conference that more initiatives were needed to ease global shortages of key goods, adding: “It’s important that we get the global value chains working better than they are today.” The IMFC also called for clear communications by policymakers to limit negative cross-country spillovers and to use macroprudential tools to limit financial vulnerabilities. The statement noted the growing divergences between rich and poor countries in economic recovery and access to vaccines, noting that recovery risks are tilted to the downside. RESERVES LENDING The IMFC said it welcomed the IMF’s efforts to establish a new Resilience and Sustainability Trust (RST) to help channel a $650 billion allocation of reserve assets to provide affordable long-term financing to poor and middle-income countries undertaking structural reforms and working to maintain balance-of-payments stability. “The RST should preserve the reserve asset characteristics of the SDRs,” the IMFC said. “We call upon the IMF to develop and implement the RST and collaborate closely with the World Bank in this process, and to provide technical support in exploring viable options for channeling SDRs through multilateral development banks.” G20 finance ministers backed plans for the new trust on Wednesday. Reporting by David Lawder, Jan Strupczewski and Andrea Shalal; Editing by Franklin Paul, Paul Simao and Andrea Ricci Our Standards: The Thomson Reuters Trust Principles.