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Top economies monitoring Ukraine for effects on global growth

Top economies monitoring Ukraine for effects on global growth
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Ukraine is a major focus for leading finance ministers and central bankers who in Washington for the International Monetary Fund and World Bank’s spring conference.

Participants said the world’s top economies are monitoring the Ukraine situation for any fallout that could undermine global economic and financial stability.

German Finance Minister Wolfgang Schaeuble said: “The Ukraine has played an important role at the sidelines” (of the IMF meeting) … We agreed that the IMF has to play a leading role in helping Ukraine.”

He added: “In the G7 we agreed that we have to find a common solution. We must not make it too difficult for Russia … we have to find a way to solve this problem in partnership. But you cannot rule out an escalation.”

IMF head Christine Lagarde used the Washington gathering to repeat her calls for reform by developed and emerging economies.

The US Federal Reserve’s reduction of stimulus is another prime topic, with countries like Brazil and India complaining that is restricting their growth – but all they got was a pledge to provide “clear and timely communication” of such actions.

European officials and politicians were also treated to concerns from the IMF and the US about deflation in the eurozone and urged to do more to avoid it.

Christine Lagarde said: “We are concerned about this potential risk of advanced economies in general, in the euro area in particular, that prolonged low inflation will hurt both growth and jobs. In this context, it is encouraging that the ECB reiterated its commitment to use unconventional measures as needed.”