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

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

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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".

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