IMF Managing Director Christine Lagarde said cheap oil prices and a resurgent U.S. economy won’t be enough to help overcome sluggishness elsewhere in global growth.
“The obvious question is this: should lower oil prices and a stronger recovery in the United States make us more upbeat about the prospects for the global economy?” Lagarde said in a speech Thursday in Washington at the Council on Foreign Relations. “The answer is most likely ‘No,’ since there are still powerful factors that weigh on the downside,”
Lagarde has been warning that the global economy needs bold policies to avoid a “new mediocre” period of weak growth as the world struggles with a disappointing recovery six years after the financial crisis. While low oil prices will provide a boost to expansion, there’s an increased urgency to support demand through actions such as infrastructure spending, she said.
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