Reply #21: IMF says US efforts to reduce twin deficits insufficient - German source [View All]

[RawMaterials]

BERLIN (AFX) - The International Monetary Fund has criticised the US' efforts to reduce its twin deficits as insufficient, a German government source said, citing the IMF's spring World Economic Outlook report due to be released later today

The IMF said the latest data on the US current account deficit were not satisfactory, the source said

It also said the US does not have a credible strategy that would consolidate the US budget in the medium-term

Meanwhile, the IMF is concerned about a number of potential risks to the global growth outlook, the German source said

The risks include the high price of oil and global economic imbalances, such as the over-dependence of the world economy on China and the US for growth, the source said

In its spring report, the IMF believes that the dollar could continue to fall against the euro and US interest rates might rise strongly, the source continued. Higher interest rates in industrialised countries could lead to a slump in property prices which would, in turn, erode household confidence, the IMF warned.



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