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IMF: Low interest rates 'could risk financial stability'

The head of the IMF has suggested the Bank of England should increase interest rates, as keeping them at their low 0.5% rate could "increase risks to financial stability".

Christine Lagarde said the IMF view was that having low interest rates "could further fuel house prices" and therefore risk destabilising the economy.

She said it was up to the Bank of England to take action on rates "in a gradual fashion as the first line of defence against risks to financial stability arising from the housing market".

UK needs 'further measures' to increase housebuilding

The head of the IMF has called for the Government to put in place more measures to boost housebuilding.

Speaking at the Treasury this morning as the IMF gives its yearly assessment of the British economy, Christine Lagarde said:

The Government needs to do more to boost housebuilding, the IMF has said. Credit: Rui Vieira/PA Wire

"Addressing imbalances in the housing market...will require further measures to increase the availability of land for development and to remove unnecessary constraints to land use.

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Christine Lagarde: 'I'm not a candidate' for EU job

The head of the IMF, Christine Lagarde, has dismissed suggestions that she is in line for a new role as President of the European Commission, the EU's executive body.

ITV News Economics Editor Richard Edgar is at a press conference with Ms Lagarde at the Treasury.

IMF: UK doing well but 'no room for complacency'

The head of the International Monetary Fund has welcomed the UK's economic progress over the last year but warned of major risks that remain.

Delivering the IMF's annual report on the state of the British economy, Christine Lagarde said that "the news coming out of the UK has been pretty much all good".

She pointed to the UK's growth rate being the highest of the advanced economies, along with signs that the economy is "rebalancing" towards a more investment-driven economy.

Christine Lagarde speaking at the Treasury on the state of the UK economy.

However, she also identified two major risks to Britain's prosperity - weak productivity and the the rapid rise of house prices.

"There is no room for complacency as there are risks looming on the horizon," Ms Lagarde said.

George Osborne: IMF will support our long-term plan

George Osborne says the International Monetary Fund will today show support for the Government's "long-term economic plan".

The Chancellor said he would "wait and see" what IMF chief Christine Lagarde would say about the British housing market when she speaks at the Treasury later.

But he argued he had created the right mechanisms to defuse the kid of risks in the housing market that have caused problems in the past.

US: IMF package needed to show Ukraine support

US Secretary of the Treasury Jack Lew met Ukrainian Prime Minister Arseniy Yatsenyuk today:

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Ukraine requests International Monetary Fund support

Ukraine has requested support from the International Monetary Fund, its Managing Director Christine Lagarde has confirmed.

Managing Director Christine Lagarde said the International Monetary Fund will send a fact-finding team to Ukraine in the coming days. Credit: PA

Lagarde said the IMF is discussing with international partners how best to help Ukraine, and will send a team to Kiev in the coming days.

Ukrainian finance minister Oleksander Shlapak said they are asking for at least $15 billion.

"Today we requested the IMF send a mission and we hope that it will be here next week," the minister was quoted as saying by Interfax news agency.

George Osborne: We're delivering economic security

Chancellor George Osborne has welcomed the IMF's upgrading of Britain's economic growth forecast, adding the coalition's plan is delivering "economic security for the hard working people of this country".

Chancellor George Osborne has welcomed the IMF's upgrade. Credit: Pool

He said: "We've had two pieces of good news today, first that the IMF have upgraded the British growth forecast by more than any other country and also good numbers in manufacturing."

He added: "I think that shows there is clear evidence that by working through our plan, by avoiding the quick fixes and easy options we're delivering economic security for the hard working people of this country."

Clegg: The Govt has set Britain on the right course

Responding to the IMF's raising of Britain's growth forecast, Deputy Prime Minister Nick Clegg has tweeted:

Ed Balls: IMF growth forecast welcome & long overdue

Responding to the IMF's decision to raise Britain's growth forecast, shadow chancellor Ed Balls said the move was both "welcome and long overdue."

Shadow Chancellor of the Exchequer Ed Balls. Credit: Press Association

He added: "But this is the slowest recovery for 100 years and working people are facing a cost-of-living crisis with real wages now down £1,600 a year under David Cameron.

"With business investment still weak and the IMF forecasting that UK growth will slow down again next year, it's clear that this is not yet a recovery that is built to last."

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