IMF: Europe poses the key risk to global economy
By Howard Schneider
Europe needs to increase the size of its economic rescue fund and take more decisive action to fix its weaker banks, the International Monetary Fund said Tuesday in a new report that cites lingering problems in Europe as the key risk to the global economy.
The 17 nations that share the Euro as a currency pledged roughly $600 billion to assure global markets that troubled countries such as Greece and Ireland would pay their bills. But to assure the fund’s credit rating remains high, only about half of that money is actually available — meaning the fund could, as a practical matter, be tapped out if another country such as Portugal or Spain needs help.