WORLD> Global Economy
|
WORLD> Global Economy
|
|
IMF says global economic recovery has begun
(Agencies)
Updated: 2009-10-01 22:45 In an interview with Reuters Television, Blanchard also said that rebalancing global foreign exchange rates was not just about adjusting the level of the Chinese yuan. "I've focused on China because it is an obvious component of the solution, but this is not a Chinese problem, it's a world problem," he added, declining to give specific levels for either the yuan or other currencies. The IMF report said the world economy will take a while before it returns to pre-crisis levels, with growth expected to average a little more than 4 percent a year after 2010. EMERGING COUNTRIES LEAD Emerging and developing countries are clearly front runners in the recovery, expanding by 1.5 percent this year before rebounding 5 percent next year led by China and India, the IMF said, also noting signs of stabilization in Latin America. The IMF revised up China's growth forecast for next year to 9 percent from a July estimate of 8.5 percent. In Japan the economy is expected to recover by 1.7 percent next year, buoyed by fiscal and monetary stimulus measures. The IMF urged policymakers not to disrupt the recovery by relaxing efforts to strengthen the financial sector and by prematurely withdrawing expansionary economic policies. In major economies, authorities can still afford to maintain accommodative conditions for a while because inflation is likely to remain subdued, the IMF said. The challenge going forward is to map a middle course between unwinding stimulus measures too early and leaving them there too long, which could damage government balance sheets. In emerging markets, raising interest rates could happen sooner than in advanced economies, the IMF said, also warning that in some countries warding off risks of new asset price bubbles may require greater exchange rate flexibility. Meanwhile, a Turkish student, who is also the editor of a small left-wing newspaper Birgun, threw a shoe which landed at IMF Managing Director Dominique Strauss-Kahn's feet on Thursday as he made a speech to students in Istanbul. The incident echoed that of an Iraqi journalist who last December hurled his shoes, a grave insult in the Muslim world, at then U.S. President George W. Bush.
|
