Statements emerged yesterday that the International Monetary Fund (IMF) has serious concerns about the state of the U.S. economy. Christine Lagarde, the IMF’s Managing Director, said that she believed the economy had “pockets of vulnerability”, citing few “tangible signs of wage or price inflation”; she is of the opinion this could have serious implications for the wider economy. In an exceptionally rare move, she urged the Federal Reserve to delay interest rate rises until 2016.
Recent data has shown that the U.S. economy actually shrank by 0.7% in the first quarter. Furthermore, Ms. Lagarde stated the IMF believed the U.S. dollar is moderately overvalued. “Continued over-appreciation is a potential risk,” she warned.
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