IMF report likely to fan financial market fears over debt default as Greece struggles to cope with austerity and recession
Poul Thomsen, of the International Monetary Fund, arriving at the Greek finance ministry in Athens on Monday.
The International Monetary Fund slashed its growth forecasts forGreece and warned that ever-deepening recession was making it harder for the debt-ridden country to meet the tough deficit reduction targets under its austerity programme.
In a report likely to fan financial market concerns about a possible debt default, the regular health check by staff at the Washington-based Fund said the situation in Greece had "taken a turn for the worse".
Poul Thomsen, deputy director of the IMF's European department and its mission chief to Greece, said: "We have revised growth down significantly to -6% in 2011 and -3% in 2012. We expected 2011 to be an inflection point when the recession bottomed out, followed by a slow recovery. But the economy is continuing to trend downwards. The hoped for improvement in market sentiment and in the investment climate has not materialised." Source