The head of the International Monetary Fund is urging national leaders to act quickly and boldly to counter a crisis of confidence that is hurting the global economy.
IMF Managing Director Christine Lagarde spoke Friday ahead of a gathering of top economic officials from the world's leading industrialized nations.
She said central banks should keep interest rates low and continue other efforts to stimulate growth because the risk of recession outweighs the risk of inflation.
Economists say if stimulus efforts go too far, they can spark rising prices that cause rising wage demands in a damaging cycle of inflation.
Largarde praised efforts to cut national deficits and debts, but said governments should be "nimble" and ready to ease short-term cuts if they hurt the fragile economic recovery.
Finance ministers and central bankers from G7 wealthy nations are meeting in Marseille, France, discussing the global economy.
The talks follow recent reports that say economic growth is likely to be slower than earlier predictions.
Some information for this report was provided by AP, AFP and Reuters.
