Thursday, 30 July 2015

IMF’s Lagarde doesn’t fear China, Europe will hurt global growth

In IMF/OECD News 30/07/2015

Christine Lagarde4
On Wednesday, managing director of the International Monetary Fund Christine Lagarde said China and Europe aren’t risks to the global economic outlook.
During a “virtual” news conference with journalists from all over the world, Lagarde was generally upbeat, despite describing the global economy as “fragile” and “unbalanced” with risks to the downside.
Lagarde said she wasn’t worried about the Chinese economy despite the recent stock market selloff.
China’s economy is “resilient” and should be able to withstand sharp moves in the country’s stock market, Lagarde said. Lagarde said the IMF is still “forecasting China [growth] at 6.8% [this year].”
“It certainly is a bit lower than what it delivered lately but it is a measured slowdown, I think very much under control,” Lagarde said.
The IMF boss also pointed out that while there has been a lot of “noise” around China’s stock fluctuations, the mainland index is still more than up 80% relative to a year-ago despite the rout in equities.
On the eurozone, Lagarde said the region “is beginning to turn the corner.”
“We have more upbeat forecasts that we’ve had in a long time,” she said.
“[The eurozone] is looking more promising,” she added.
On Greece, Lagarde reiterated that there needed to be a “significant” debt restructuring in order for “any program to fly.”
She said she wasn’t concerned with the harsh rhetoric in the country about the so-called troika, as Greece’s international creditors, the IMF, the EU and the European Central Bank are sometimes referred, that is pushing Greece to adopt reforms before getting assistance.
Lagarde noted that a lot of things are said in the heat of politics but what counts are actions.
Negotiations on a third Greek bailout deal are set to resume in Athens later this week.

Source: MarketWatch