IMF chief sees unemployment rising in 2011

Monday August 31, 2009

ATHENS: World unemployment will continue to rise in 2010 and perhaps in 2011 in more developed economies despite the expected recovery, International Monetary Fund Managing Director Dominique Strauss-Kahn said on Sunday.

"We must continue to work hard to ensure that a sustainable recovery comes indeed in the first half of 2010. But, despite the recovery, unemployment will continue to rise in 2010 and perhaps in the more developed economies even in 2011," he said in an interview with the Greek Kathimerini newspaper.

He warned against taking the recovery for granted, saying risk still remained. "The basic short-term risk is for the recovery to stop, something that could be caused by a series of negative developments," he said.

"A possible premature exit from a loose fiscal and monetary policy constitute a risk, if fiscally supported growth is erroneously seen as a sustained recovery." He said another key concern is that higher oil prices could hinder recovery.

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