The International Monetary Fund (IMF) says policymakers in advanced economies should use all available tools to boost growth. Christine Lagarde, Managing Director of IMF, said this in London while calling for bold action to “weather a dangerous new phase of recovery”.

Lagarde welcomed a 447 billion dollar plan presented by President Barack Obama to boost a sluggish economy and create jobs. Lagarde said that countries faced with market pressures must press ahead with urgent fiscal consolidation, while there was scope for slower action in other countries not at the mercy of market forces. She said that economic policymakers had to act with “conviction and urgency” in supporting a faltering global economy giving her blessing to further quantitative easing.

”Policymakers should stand ready, as needed, to take more action to support the recovery, including through unconventional measures,” Lagarde said. She said that the meeting with finance ministers and central bankers from the Group of Seven wealthy nations at a meeting in the French city of Marseilles and the IMF annual gathering in Washington would help nations to tailor policies to tackle the specific economic challenges they faced. “For the advanced economies, there is no question that fiscal sustainability must be restored through credible consolidation plans.

“But we also know that consolidating too quickly will hurt the recovery and worsen job prospects. So the challenge is to find the pace of adjustment that is neither too fast, nor too slow. “Monetary policy also has a role to play in the advanced economies. Broadly speaking, it should remain highly accommodative, as the risk of recession outweighs the risk of inflation,” she said. Lagarde also said euro zone countries must implement measures agreed on financing in July and warned that some of Europe’s banks would need more capital.

“The road ahead may be rocky, but a way forward exists if we act now. With each country playing their part, we can identify the actions needed to achieve strong, sustainable and balanced growth,” she said.