Thursday, July 08, 2010

EconomyGlobal: IMF: USA has problems but is on the mend econonomicalloy

July 8, 2010, 9:31 a.m. EDT
IMF says U.S. on mend but job rate to stay high
By Greg Robb
WASHINGTON (MarketWatch) -- The U.S. economic recovery is becoming increasingly well-established but the unemployment rate will stay above 9% through 2011, according to a report from the International Monetary Fund released Thursday. The U.S. economy and financial system have made great strides in recovering from the Great Recession, but more work needs to be done, the IMF said. "The outlook has improved in tandem with the recovery, but remaining household and financial balance sheet weaknesses --along with elevated unemployment -- are likely to continue to restrain private spending," the IMF said. Important parts of the banking system remain vulnerable to shocks, even though the financial reform legislation would make major steps to close gaps in the regulatory system, the agency said. The European debt crisis has tipped risks to the downside because of potential financial market disturbance, the IMF said.

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