IMF’s Lagarde Calls for Urgent Economic Overhauls

The head of the International Monetary Fund on Saturday called for the world’s largest economies to urgently move ahead with economic overhauls as the global growth outlook sours and market turmoil rocks emerging markets.

“Downside risks to the outlook have increased, particularly for emerging market economies. Against this backdrop, policy priorities have taken on even more urgency since we last met in April,” IMF Managing Director Christine Lagarde said after a meeting of top finance officials from the Group of 20 largest economies.

The International Monetary Fund said earlier this week that it plans to downgrade its global growth outlook for the year–already at its slowest rate since the financial crisis–in part because China’s slowdown is weighing on global output more than expected.

Several of the world’s largest emerging markets are already in recession and struggling to revive growth, especially those reliant on commodity exports. Emerging market woes come as the Federal Reserve prepares to raise interest rates, possibly as soon as this month, pushing up borrowing costs around the world.

“A concerted policy effort is needed to address these challenges, including continued accommodative monetary policy in advanced economies; growth-friendly fiscal policies; and structural reforms to boost potential output and productivity,” Ms. Lagarde said.

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Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.