Eurozone crisis: Lagarde orders Europe to ‘fix the roof’ – IMF poised for growth u-turn

Monday, June 25, 2018
By Paul Martin

THE International Monetary Fund (IMF) chief Christine Lagarde used her meeting today in Ireland with Taoiseach Leo Varadkar to warn that although “the sun is shining on the Irish economy” it is time for the eurozone to “fix the roof” as the IMF prepares for a climbdown on growth forecasts.

By DAVID DAWKINS
Express.co.uk
Mon, Jun 25, 2018

Mrs Lagarde, visiting Dublin to mark 20 years since the adoption of the euro currency, was eager to champion the manner by which Ireland came out of the EU-IMF bailout in December 2013 following the eurozone’s sovereign debt crisis. However the IMF faces a u-turn on what now looks like overly “optimistic” growth GDP forecasts for the bloc in 2018.

Standing alongside Taoiseach Leo Varadkar the IMF chief said: “One of the motives that we have been advocating has been borrowed from one of most famous Irish-American politicians John Fitzgerald Kennedy, who is notorious for having said that it is when the sun is shining that you fix the roof.

“And clearly the sun is shining on the Irish economy.”

However, the IMF is widely expected to revise down its growth forecasts for the eurozone with some of Germany’s top firms facing massive risk from US President Donald Trump’s trade tariffs and Britain’s ability to trade with the EU after Brexit.

Sounding a clear warning on the bloc’s mounting problems, she said: “We meet at a moment when the EU and euro area are in the midst of difficult decisions about their future.

“Populist movements – from Brexit to the recent Italian elections – have called into question the value of European integration.”

Mrs Lagarde has been preparing the way for the climbdown following similar revisions from the European Central Bank (ECB) – who slashed growth forecasts for the bloc from 2.4 percent to 2.1 percent, and Germany’s Bundesbank who slashed the forecast for the bloc’s largest economy from 2.5 forecast in December to two percent for the remainder of 2018.

Last week she said: “We will probably update and revise our growth forecasts for the euro area modestly, but we will revise it down a little bit.”

The rest…HERE

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