No Double Dip, Stimulus Did Help: IMF Chief
There is unlikely to be a double-dip recession, while the fact that stimulus spending was helpful in containing the crisis is undisputable, Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF), told CNBC Monday.
The US has taken the correct approach in dealing with the economic slowdown and making sure the recovery is sustainable, Strauss-Kahn added.
"It's not our baseline. We don't believe that the double dip will take place," he said. (Click here for the full interview)
Fears of a double dip have increased recently, with some analysts saying austerity in Europe could sink the world into a second recession.
Stimulus spending was the key for containing the crisis, according to Strauss-Kahn.
"The fact that the stimulus was absolutely useful is not challenged by anyone now," he said.
"I think what the US is doing today is the right thing. I think as long as they will support (the recovery), finally it will pick up and create jobs," Strauss-Kahn added.
But the effect of the US policy will not be immediate, he said.
"We need to wait for one or two quarters to be sure," according to Strauss-Kahn.
Some officials and analyst said that financial markets' lack of supervision and risky bets have caused the crisis.
"Blaming the markets doesn't make a lot of sense," Strauss-Kahn said.
Regulators need to put in place better rules and supervision to make sure markets are effective, he added.
Strauss-Kahn did not want to respond to speculation that he was looking for a political position back in France.
"We're working in the direction of finding jobs for those who don't have a job. I have a job," he said.