IMF Says Global Financial Risks Rising as Growth Outlook Weakens

The gloomy mix of conditions “increases the urgency of a broad-based policy response, both individually and collectively, to raise growth, manage vulnerabilities and boost confidence,” the IMF said Wednesday in its semiannual report on financial stability. Without such actions, market turmoil may recur, eventually increasing chances of a prolonged slowdown marked by financial institutions struggling with “impaired balance sheets for an extended period of time.”

The report echoes themes in Tuesday’s economic outlook from the IMF, which lowered its forecast for global growth and said the world has become more exposed to negative shocks. The pronouncements set a downbeat tone as finance ministers and central bankers gather in Washington this week for spring meetings of the IMF and World Bank.