The International Monetary Fund has urged governments to take action to tackle a record $152tn debt mountain before it triggers a fresh global financial and economic crisis. Excessive private debt was making global recovery more difficult and had increased the risk of financial instability. Rapid rises in private debt often led to financial-sector triggered recessions which were longer and deeper than normal downturns. Some countries, including the UK, have seen a decline in non-financial private sector debt since the world economy fell into recession in 2008. But the IMF expressed concern about the rapid growth of China’s private sector debt to GDP ratio, up 70 percentage points between 2008 and 2015.

Source: The Guardian October 05, 2016 15:02 UTC