IMF issues fresh warning to central banks against raising rates

China concerns should keep rates low

The International Monetary Fund has issued a fresh warning to central banks against raising interest rates too soon, amid concerns hikes remain a threat to global growth following the recent market volatility.

In a note ahead of a G20 meeting at the weekend, the IMF said "risks are tilted to the downside" as growth rates in the majority of economies had fallen short of expectations in the first half of the year, and the slowdown in the Chinese economy is set to have further impact on global growth. Also lower oil prices have failed to give the expected boost to economies and inflation remains at low levels. As a result, central banks "must stay accommodative to prevent real interest rates from rising prematurely", said the IMF, according to the FT. Gross warns US rate rise 'too little, to...