HIGHLIGHTS-IMF, World Bank, G20 meetings in Washington The following are comments on Thursday from finance officials in Washington for the fall meetings of the International Monetary Fund and World Bank, and a meeting of Group of 20 leaders. WORLD BANK PRESIDENT JIM YONG KIM ON WHAT A U.S. DEFAULT COULD MEAN: "We did a review just recently of what happened to developing countries after the August 2011 near miss on the default. And what we found is that in developing countries the cost of borrowing, bond spreads, went up by about 75 basis points and that elevated bond spread persisted for months. The stock markets in developing countries dropped by about 15 percent and that also persisted. So what we know is that even a near miss will have a real impact on developing countries ... If you look at the increase in the bond spreads and also the falling of the stock markets, those have a direct impact on U.S. exports. Fifty percent of exports are to developing countries, so we hope that for many, many reasons policymakers here move quickly and resolve this crisis." IMF MANAGING DIRECTOR CHRISTINE LAGARDE ON U.S. DEBT CEILING: "It is critical that the exit of highly accommodative (U.S.) monetary policy be carefully managed, that the fiscal house of the United States of American be put in order, and obviously we know and you know right now that failure to raise the debt ceiling would cause serious damage to the U.S. economy, but also to the global economy."
Posted on: Thu, 10 Oct 2013 14:42:03 +0000
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