IMF to consider boosting precautionary financing - Lagarde | Reuters

WASHINGTON International Monetary Fund Managing Director Christine Lagarde said on Thursday that low oil and commodities prices would continue for some time, and the Fund will consider strengthening and broadening its array of precautionary financing instruments.

In a speech at the University of Maryland, Lagarde said that advanced economies should take steps to support growth through accommodative monetary policy and infrastructure spending, while emerging economies can help by boosting non-commodity revenues and allowing more flexible exchange rate policies.

She called for a stronger global financial safety net to help limit the effects of China's slowdown, but offered few details.

"One could think about strengthening and broadening the global precautionary financing instruments that work for everyone," Lagarde said. "One could also increase the size of the safety net. Over the next few months, the IMF will be considering with our members these and other issues related to the international monetary system."

Lagarde said that the implementation of new voting reforms that have boosted the influence of emerging markets like China and Brazil have doubled the Fund's permanent resources.

She said that the rebalancing of China's economy from exports and investment to domestic consumption and services would lead to more sustainable growth.

"In the short run, however, it will lead to slower growth, and this slowdown creates spillover effects -- through trade and lower demand for commodities, and amplified by financial markets."

(Reporting By David Lawder Editing by W Simon)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date: Feb 04, 2016 23:15 PM

Also Watch

Social Media Star: Abhishek Bachchan, Varun Grover reveal how they handle selfies, trolls and broccoli
  • Monday, July 16, 2018 It's a Wrap: Soorma star Diljit Dosanjh and Hockey legend Sandeep Singh in conversation with Parul Sharma
  • Monday, July 16, 2018 Watch: Dalit man in Uttar Pradesh defies decades of prejudice by taking out baraat in Thakur-dominated Nizampur village
  • Monday, July 16, 2018 India's water crisis: After govt apathy, Odisha farmer carves out 3-km canal from hills to tackle scarcity in village
  • Sunday, July 15, 2018 Maurizio Sarri, named as new Chelsea manager, is owner Roman Abramovich's latest gamble in quest for 'perfect football'

Also See