IMF warns of debt risks as recovery slows

“Downside risks to the recovery have intensified. The combination of sovereign risk and a still weak financial sector in many advanced economies poses significant risks to the recovery,” the IMF said.

“Global growth has been somewhat stronger than expected during the first half of 2010,but is projected to slow temporarily during the second half of 2010 and the first half of 2011.”

The fund warned the recovery remained “fragile” in advanced economies,as private firms struggle to pick up the slack left by retreating government stimulus spending.