The International Monetary Fund (IMF) has cut its forecast for US economic growth, in its regular economic assessment. Sources state that IMF commented that Washington and the debt ridden European countries are playing with fire and is advised to take immediate action to work on their budget deficits; with bigger threats to the world economy looming.
“You cannot afford to have a world economy where these important decisions are postponed because you’re really playing with fire,” said Jose Vinals, director of the IMF’s monetary and capital markets department. “We have now entered very clearly into a new phase of the (global) crisis, which is, I would say, the political phase of the crisis,” he said.
In its regular global economic prospects assessment, IMF has lowered its 2011 global growth forecast to 4.3% from 4.4%; and has kept the 2012 forecast unchanged at 4.5%.