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IMF chief warns of lagging global growth

Christine Lagarde warned that ‘‘uncertainty’’ continued to plague the global economy.

Paul J. Richards/AFP/GettyImages

Christine Lagarde warned that ‘‘uncertainty’’ continued to plague the global economy.

WASHINGTON — Christine Lagarde, the managing director of the International Monetary Fund, warned Monday that the institution would probably cut its estimates of global growth yet again this year because of the tepid US recovery, a slowdown in emerging economies, and continued troubles in the eurozone.

Still, she praised the world’s central banks for taking decisive action to ease fraught financial conditions and aid the global recovery in recent months.

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‘‘It may well be that central banks will have played a significant role in pulling the global economy out of this great recession,’’ Lagarde said in remarks prepared for a meeting at the Peterson Institute for International Economics, a Washington-based research group. ‘‘But we should not get ahead of ourselves.’’

Lagarde said the fund would ‘‘likely’’ trim its growth estimates in a periodic update to its economic forecasts, to be delivered at a joint meeting of the World Bank and the IMF in Tokyo next month.

In its last estimate, made in July, the fund saw global economic growth of 3.5 percent in 2012 and 3.9 percent in 2013. The global economy grew about 4 percent in 2011.

“Clearly, downside risks continue to loom large, importantly reflecting risks of delayed or insufficient policy action,’’ the fund said in its last estimate.

Lagarde warned that ‘‘uncertainty’’ continued to plague the global economy, depressing growth in both high- and low-income countries. She repeated her often-delivered message that European policymakers still have much work to do to forge a banking union and ease credit conditions in countries such as Spain.

She also delivered a stark warning to US political leaders about the uncertainty over the so-called fiscal cliff, a spate of tax hikes and spending cuts that some economists say are large enough to throw the economy into recession next year.

‘‘We all recognize that political calendars impact the timing of key decisions. This is true everywhere. But the current uncertainty presents a serious threat for the United States and, as the world’s largest economy, for the global economy,’’ Lagarde said. ‘‘We all hope that political clarity emerges soon, and with it, actions to avoid the fiscal cliff and, also, a concrete plan to bring down debt gradually over the medium-term.’’

Financial markets have cheered recent actions from the world’s central banks to help the economy. But Lagarde’s comments and other recent reports underscore the continuing weakness.

On Friday, the World Trade Organization slashed its forecasts for global trade, cutting its estimate of trade growth in 2012 to 2.5 percent from 3.7 percent. It also slashed its 2013 estimate, to 4.5 percent from 5.6 percent.

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