The 2010 global growth forecast issued by the International Monetary Fund has been upgraded on the back of strong growth in Asia and resurgent US private demand. The growth for 2010 was increased from 4.2% to 4.6%. The IMF also issued a warning in regards to European markets, saying they posed some of the biggest risk to global growth. Sovereign debt risks within Europe had the potential to pull down the global economy. Housing and Labour markets in the United States also showed persistent weakness.

This growth has been factored in on the assumption that new policies would be introduced to help stimulate confidence in specific markets. For projecting purposes, the IMF assumed that Europe’s debt problems would have a similar effect on financial markets as that of the Lehman Brothers 2008 failure. Policies to be introduced by countries needed to find a balance between building confidence in markets but without suffocating growth. This means a combination of reducing fiscal debt whilst at the same time investing in growth orientated stimulus.

The former chief of the IMF, Kenneth Rogoff, said that while there were a number of risks and unknowns in the global market, he did not expect the economy to fall back into a recession.