July 6, 2012 at 9:55 AM ET
Faced with slower growth in China, a struggling job market in the U.S., and Europe's inability to wrestle down its debt crisis, the IMF is expected to reduce its outlook for the global economy later this month, the fund's Managing Director Christine Lagarde said Friday.
"In the IMF's updated assessment of the world economy, to be released 10 days from now, the global growth outlook will be somewhat less than we anticipated just three months ago. And even that lower projection will depend on the right policy actions being taken," she said in a speech Friday.
She did not give further details, nor did she pinpoint which economies were contributing to the lowered expectations.
The comments by IMF Managing Director Christine Lagarde came after the European Central Bank, the Bank of England and China's central bank all eased monetary policy in a sign of the growing alarm over the health of the world economy.
Her statement came not long before the U.S. Labor Department reported that the nation's economy created a disappointing 80,000 jobs in June, while the unemployment rate remained stuck at 8.2 percent, raising the stakes that the Federal Reserve may need to provide additional stimulus to move the economy out of its rut.
China, the world's second-biggest economy, releases a raft of data next week, including on second-quarter GDP.
"In the last few months, the global outlook has been more worrying for Europe, the United States and large emerging markets," Lagarde said in a speech in Tokyo.
The IMF will publish an update to its World Economic Outlook report on July 16.
She welcomed growing cooperation in Europe to tackle the sovereign debt crisis but said that further fiscal cooperation was needed.
In the IMF's April report, it revised upward its global growth forecast for this year to 3.5 percent from 3.3 percent in January, and to 4.1 percent for 2013 from 3.9 percent previously.
Lagarde acknowledged that the two main concerns for Japan's economy were a further appreciation of the yen and risks posed by Europe's debt crisis to demand for Japanese exports.
The yen is moderately overvalued and there is a risk it could rise further if Europe's debt crisis spurs a flight away from riskier assets, she said.
Reuters and The Associated Press contributed to this report.