Christine Lagarde warns against relying too much on monetary easing
The IMF chief has welcomed the US Fed's approach to rely on economic data in setting the future pace of interest-rate hikes
Davos, Switzerland — International Monetary Fund (IMF) chief Christine Lagarde on Thursday warned countries against relying too much on monetary policy to counter another economic downturn, urging them to undertake fiscal and structural reforms to boost their economies' resilience to shocks. Lagarde also welcomed the US Federal Reserve's approach to rely on economic data in setting the future pace of interest-rate hikes, as simmering trade frictions cloud the economic outlook. The Fed was among the few central banks that has "a little bit" of policy space left to expand stimulus, she said. "It would be very nice if the economies at large didn't have to rely on central banks yet again in order to resist the next shock," Lagarde told delegates at the World Economic Forum in the Swiss ski resort of Davos. "Policy makers have to really take the right course of action when it comes to fiscal policies, when it comes to completing the reforms," she said. Simmering trade frictions and fears...
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