IMF chief says volatile markets represent ‘necessary corrections’

The latest volatility in global financial markets represents “necessary corrections”, IMF chief Christine Lagarde said in Dubai on Sunday, in the wake of a severe plunge on Wall Street.

“The market trepidations that we have seen in the last few days are not worrying me. Those market movements were clearly, in our view, necessary market corrections,” she told an audience at Dubai’s World Government Forum.

Wall Street stocks ended a bruising week on a benign note, courtesy of a late-session surge on Friday, while equity markets in Europe and Asia fell sharply in volatile trading.

“I would not focus on what has happened in the last few days. I would focus on the imperatives of change going forward and the need to fix the roof,” Lagarde said.

On Saturday, she had urged Arab countries to slash public wages and subsidies to rein in spending, achieve sustainable growth and create jobs.