IMF’s Lagarde Says European Crisis Not Over Yet

Europe is on the mend, but the economic crisis that has plagued the region since 2008 is not over yet, International Monetary Fund (IMF) Managing Director Christine Lagarde has warned.

In an interview with German daily Handelsblatt published Monday , the IMF chief warned that in particular companies in southern Europe were still struggling to gain access to credit.

“The recovery is underway, that is correct. Some countries have successfully exited the aid programs. But that does not mean that the crisis is over and that our mission is accomplished,” Lagarde told the paper.

Several euro zone countries, most notably Greece, faced financial ruin when high levels of public debt forced their borrowing costs up to unsustainable levels. International lenders stepped in to save them from bankruptcy. Some – like Greece – had been living beyond their means. Others, like Ireland, were brought to the brink by failing banks which they were forced to bail out.

Greece, Portugal, Cyprus and Ireland all entered toughausterity programs in return for aid, while Spain received EU funds to rescueits banking sector but avoided a full-blown bailout.

Lagarde warned that the low levels of inflation currently witnessed in the euro zone also posed risks to the recovery, echoing comments made by European Central Bank President Mario Draghi.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza