IMF says stimulus needed to aid ' nascent' recovery

The International Monetary Fund on Saturday said emergency stimulus measures must remain to avoid endangering a "nascent" economic recovery, as the G20 agreed here to maintain support. "An overarching risk is that the recovery stalls" owing to early exits from record-low interest rates and massive state cash injections, the IMF said in a report to coincide with a meeting of G20 finance ministers in St Andrews. "Premature exit from accommodative monetary and fiscal policies could undermine the nascent rebound, as the policy-induced rebound could be mistaken for a strong and durable recovery," the IMF said. The world's largest and top emerging economies on Saturday agreed to maintain stimulus measures to support "uneven" economic recovery. "The recovery is uneven and remains dependent on policy support, and high unemployment is a major concern," the G20 said in its final communique. "To restore the global economy and financial system to health, we agreed to maintain support for the recovery until it is assured."