The IMF says plans to reduce government debt are holding the economy back. It's the most forthright criticism yet of Osborne's austerity.
The Chancellor has defended his recession-busting approach, and his record on taxing the rich, on the sidelines of the IMF meeting in Tokyo.
Sir Mervyn King will concede there might be occasions when the Bank of England should 'aim off' the 2% inflation target.
International Monetary Fund (IMF) chief Christine Lagarde said the rescue deal agreed for Cyprus is "sustainable" and financially sound.
Although the plan allows the IMF to make a contribution to the loan, Ms Lagarde said it was too early to say how much the lender would provide towards the package.
"We believe the proposal is sustainable for the Cyprus economy ... The IMF is considering proposing a contribution to the financing of this package", she told a news conference.
"The exact amount is not yet specified. It will take some time," Ms Lagarde added.
The US Secretary of State John Kerry has said the United States will only continue its co-operation with Egypt if the country makes the "right fundamental choices regarding the IMF", according to Reuters.
He said it was "paramount" the country reached a political consensus on how to introduce economic reforms, such as reducing energy subsidies, before it could access a $4.8 billion (£3.1 billion) loan.
The International Monetary Fund's World Economic Outlook update predicted that the global economy would grow 0.1% less than anticipated.
The global economy is now forecast to grown by 3.5% in 2013 and 4.1% in 2014.
Much of the reduction stemmed from a weaker outlook for the eurozone.
The International Monetary Fund (IMF) has trimmed its forecast for UK and global economic growth this year and next year.
Britain will only expand by 1% in 2012-13, according to the respected body, 0.1% less than previously predicted.
The forecast for next year has been downgraded from 2.2% to 1.9% since October.
Egyptian Prime Minister Hisham Kandil has said that that talks with the International Monetary Fund on a crucial $4.8 billion (£3bn) loan would be back on track "very soon".
"Because of the domestic situation we had to postpone that, so we are doing a quick evaluation. We are going to be back on track very soon," he told a business forum in Cairo.
"We invited another mission of the IMF to again realign the programme so we can move forward with our national reform programme to handle the budget deficit, to handle the fiscal problems so we can move forward with growth."
Former International Monetary Fund chief Dominique Strauss-Kahn has reached an agreement to settle a lawsuit brought by a New York hotel maid who accused him of trying to rape her, a person familiar with the case has told the Associated Press.
Strauss-Kahn resigned as head of the IMF and ended his French presidential ambitions last year following the allegations from Nafissatou Diallo.
Prosecutors subsequently dropped related criminal charges.
The person familiar with the case said Bronx Supreme Court Judge Douglas McKeon has facilitated the agreement between the parties, but it has yet to be signed.
Key figures have reacted to last night's deal to reduce Greece's debt.
IMF Managing Director Christine Lagarde: "The IMF wanted to make sure the euro partners would take the necessary actions to bring Greece's debt on a sustainable path. I can say today that it has been achieved."
European Central Bank chief Mario Draghi: “I very much welcome the decisions taken by the ministers of finance. The decision will certainly reduce the uncertainty and strengthen confidence in Europe and in Greece.”
Jean-Claude Juncker, head of the eurogroup: “This is the promise of a better future for the Greek people and for the euro area as a whole, a break from the era of missed targets and loose implementation.”
Greek prime minister Antonis Samaras: "Everything went well... All Greeks fought together. A new day begins."
Eurozone finance chief Jean-Claude Juncker said the agreement includes:
- A plan to reduce Greece's debt level to 124% of its GDP by 2020 and below 110% by 2022. The IMF had originally insisted on a debt-to-GDP ratio of 120% by 2020.
- A cut of 100 basis points on the interest rate charged to Greece by other Eurozone member states, excluding those countries also receiving bailouts.
- A 15-year extension of the maturities of loans from other countries and the eurozone's bailout fund - the European Financial Stability Facility - and a deferral of interest payments by Greece on EFSF loans by 10 years.
Greek Prime Minister Antonis Samaras welcomed the Eurozone finance minister's decision to reduce its debt target as a great victory.
"As Greeks, we fought together. And tomorrow a new day begins for all Greeks," Mr Samaras said.
Eurozone finance chief Jean-Claude Juncker said the first disbursement of the Greek bailout loan is set to be released on December 13, the Associated Press reported.
"This is not just about money," Mr Juncker said. "It is the promise of a better future for the Greek people and for the euro area as a whole".