Senior IMF official:

  • China's property sector problems have not been addressed in a comprehensive way, leading to consumer confidence plummeting.
  • The risk of deflation in China has increased, which hurts Asian countries that must compete with China's falling export prices.
  • Any kind of political uncertainty has a bearing on sentiment and economic activity, when asked about Japan's general election outcome.
  • Since the Bank of Japan is normalizing monetary policy and interest rates are rising, it's even more important for Japan to start fiscal consolidation in earnest.
  • Any new initiative or fiscal support that Japan deploys should be targeted and funded within the budget, instead of by issuing more debt.
  • Any further rate hikes by the Bank of Japan should be gradual and data-dependent.
  • Japan is fully committed to a flexible exchange rate regime, when asked about authorities' recent remarks describing yen moves as 'one-sided and sharp.'
IMF heading to Kiev for more bailout talks

***

Despite it being the IMF its hard to argue with any of those points!