International Monetary Fund chief Christine Lagarde said central banks in advanced economies such as the US and Europe should keep their easy-money spigots open amid threats to global growth.
"Despite their stronger performance recently, the risks of stagnation and deflation continue to loom large," IMF's managing director said in a Project Syndicate op-ed.
"Central banks should return to more conventional monetary policies only when robust growth is firmly rooted," she said.
Ms. Lagarde's warnings come despite the IMF's plans to revise upward its global growth projections in its World Economic Outlook update due out January 21st. The fund cut its forecast for global growth in October to 3.6%, its sixth consecutive downgrade. The Federal Reserve last month decided to start gradually winding down its $85 billion-per month bond-buying program amid signs the US economy was improving.