IMF urges faster US cuts

THE INTERNATIONAL Monetary Fund (IMF) has urged the United States to come up with credible measures to reduce its record budget deficit, heaping pressure on the White House.

President Barack Obama will today outline fresh plans for reducing the nation’s debt, which is on track for hitting $1.4 trillion (£857bn) this year, as he attempts to seize the high ground in a debate with Republicans over how best to cut costs.

But the IMF said in its latest ‘Fiscal Monitor’ report that a further delay of action to cut the country’s deficit could be “fiscally costly”. It added that a “major” adjustment will be needed next year to put the budget back on track. The US posted a monthly budget deficit of $188bn (£115.5bn) in March, the Treasury Department reported yesterday. The deficit will reach 10.8 per cent of its gross domestic product this year, the largest among major developed economies.