IMF nations point to exchange rate, geopolitical risks

Sat Apr 18, 2015 4:04pm EDT
 
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By David Chance and Anna Yukhananov

WASHINGTON (Reuters) - The International Monetary Fund's member nations on Saturday warned of risks to the global economy from exchange rate shifts and geopolitical tensions as they took note of "moderate" global growth and "uneven prospects."

While economies in developed countries have strengthened, some emerging nations are being hit by weaker commodity prices and exports, the IMF's steering committee noted in a communique.

With the United States poised to hike interest rates, the panel - speaking for the Fund's 188 member nations - said moves toward "policy normalization" needed to be effectively communicated to reduce adverse impacts on other economies.

It also said the "possibility of lower growth potential" was becoming an important global challenge, a topic the panel's chairman said was central to talks on Saturday.

"I came out of this meeting with a sense of optimism," the chairman, Mexican Finance Minister Agustin Carstens, said.

"The fact that a lot of the discussion basically rotated around how to increase growth ... and not only discussing risks - I think that was a very good sign."

The spring meetings of the IMF and World Bank, which conclude on Sunday, have taken place amid growing concerns cash-strapped Greece will fail to reach agreement with its European Union and IMF creditors on reforms that would unlock bailout cash and stave off default.

At the same time, risks of a stronger dollar and low commodity prices have hit emerging markets as China's blistering economic growth has slowed.   Continued...

 
Finance Ministers and bank governors gather for a group photo of the International Monetary and Financial Committee (IMFC) governors, during the IMF and World Bank's 2015 Annual Spring Meetings, in Washington, April 18, 2015.   REUTERS/Mike Theiler