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IMF chief rules out double-dip global recession

30 June 2010 11:31 (UTC +04:00)

Baku - APA-Economics. IMF chief Dominique Strauss-Kahn on Tuesday ruled out the immediate prospect of a double-dip recession scuttling the fragile global economic recovery, despite various risks, AFP reported.

The "recovery will go on without a double dip," the IMF managing director said to a question at a forum hosted by the Peterson Institute for International Economics in Washington.

Global markets went into a tailspin Tuesday as sagging American consumer confidence, weak Chinese economic indicators and European financial problems renewed fears the global economic recovery may falter.

The United States and many other key economies plunged into the worst recession in decades following an American home mortgage meltdown in 2007 which triggered a financial crisis sending shockwaves across the globe.

But Strauss-Kahn said "the IMF hasn’t changed its views" on sustained global growth from the recession.

"It’s (double-dip) not in the baseline for us... but there are high tail-risks," he said, citing as examples the "fiscal situation" in some countries and problems created by large credit flows to relatively fast-growing Asian and other emerging nations

"There are many possible triggers for a double dip," he said, adding "it will be ridiculous to say there are no risks at all."

Strauss-Kahn believed the much faster-growing Asian economies could make up for any slack in economic expansion afflicting the United States or Europe, where a mounting fiscal crisis has threatened to slam the brakes on growth.