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The IMF wants to avoid defaults in the U.S.

Avoid default at all costs. It's essentially the message sent Wednesday to the U.S. government by the International Monetary Fund (IMF), while Republicans and Democrats still have not found common ground to allow an increase in the ceiling of the debt of the United States .

Past the deadline of August 2, the Treasury Department, which has already reached the borrowing limit currently set at 14 300 billion, has warned that it would no longer enough to pay the bills of the state and that it would not be able to meet its loan repayments. For the IMF, the worst-case scenario could result in a lowering of the AAA rating of U.S. sovereign debt."The risk of a distant downgrade the United States and a sudden jump in interest rates on the debt of the federal government more generally could cause further turmoil in global financial markets," explains international organization in its annual report on economic conditions in the country.

"These risks may also have important global implications, given the central role of Treasuries (U.S. government bonds, Ed) in global financial markets," said Fund."Of course, the federal debt ceiling should be raised quickly to prevent a severe shock to the economy and global financial markets."

"We will reach an agreement"

Shortly after the publication of this report alarmist, President Barack Obama stepped into the breach: "The Vice President Joe Biden and I will continue negotiations with the leaders of both parties in Congress as long as necessary. We will reach an agreement that will require our government to live within its means, "he promised at a news conference, adding that the consequences of a lack of agreement would be" substantial and unpredictable " . "Nobody wants to compromise the quality of the signing of the United States. Nobody wants to see the United States into default. We must seize this moment and do it quickly, "said Bush low interest rate personal loans.

Back to the wall, the Treasury secretary, Timothy Geithner, has again urged the opposition to vote on the increase. "The U.S. is now forced to borrow about 40 cents for every dollar spent. Your proposal to let the debt cap at this level would require removing about 40% of all payments from the state. Such deep cuts would be felt by every American, and may cause the economy back into recession, "he warned.

The IMF, which is already looking beyond the vote, said that the Administration should seek "a quick consensus on a comprehensive plan for fiscal consolidation in the medium term, based on realistic macroeconomic assumptions.The main challenge for economic policy is to implement a sustainable and significant rebalancing of the budget while ensuring that the recovery remains fragile, remains on track. "

Growth 'modest' perspective

Regarding the pace of recovery in world's largest economy, the IMF has maintained its forecast of growth of 2.5% in 2011, already given June 17 as part of its global forecasts. He was counting on 3% in January and April of 2.8%. "We anticipate that growth will remain relatively small, private demand is not taking up slowly and the support of fiscal policy is removed," wrote economists from the IMF.They see "a slow decline in unemployment," a further debt relief for households "likely to weigh on private consumption in the years to come," an investment that would return "to more normal levels" and exports helped by "the recent depreciation of the dollar. "

The IMF is less optimistic than the U.S. central bank, which is between 2.7% and 2.9% economic growth yoy in the fourth quarter.

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