AFP reported that Ms Christine Lagarde MD of International Monetary Fund expressed concern at a deterioration in the global economy, saying the outlook has become more worrying as developed and big emerging nations show signs of slowing down.

Her comments came after the European Central Bank, the Bank of England and China's central bank all eased monetary policy in a sign of the growing alarm over the health of the world economy.

Ms Lagarde said that "In the last few months, the global outlook has been more worrying for Europe, the United States and large emerging markets."

She said that the IMF will downgrade some of its economic forecasts later this month as economic data from major and emerging economies has deteriorated in recent months. She added that "The IMF's forecasts are likely to be lower than our previous forecasts."

The IMF will publish an update to its World Economic Outlook report on July 16th 2012.

She welcomed growing cooperation in Europe to tackle the sovereign debt crisis but said that further fiscal cooperation was needed.

In the IMF's April report, it revised upward its global growth forecast for 2012 to 3.5% from 3.3% in January 2012 and to 4.1% for 2013 from 3.9% previously.

Ms Lagarde acknowledged that the two main concerns for Japan's economy were a further appreciation of the yen and risks posed by Europe's debt crisis to demand for Japanese exports. She said that the yen is moderately overvalued and there is a risk it could rise further if Europe's debt crisis spurs a flight away from riskier assets.

Source - AFP

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