Bloomberg News

Lagarde Sees No Debt Restructuring for Portugal, Expresso Says

January 04, 2013

International Monetary Fund Managing Director Christine Lagarde said debt restructuring is not on the table for Portugal and the country’s authorities are determined to continue their aid program to regain access to bond markets, Expresso reported, citing an interview.

Portugal’s aid program is on the “right path” and a significant part of the adjustment has been carried out, Lagarde was cited as saying by the newspaper. The IMF is worried about the increase in unemployment, she said in the interview, carried out in mid-December.

The IMF chief also said it’s a matter for the European Central Bank whether it decides to buy the government bonds of countries such as Ireland and Portugal under its Outright Monetary Transactions program.

Lagarde said Greece must focus on its reform program as its European partners and other creditors have gone “very far” with their support, according to the newspaper.

The IMF says the focus of budget cuts should be structural targets and not nominal targets, Lagarde told Expresso. Fiscal policies should be accompanied by accommodative monetary policies, she said.

Lagarde also said she doesn’t expect a hard landing for the Chinese economy at this time, according to Expresso.

To contact the reporter on this story: Joao Lima in Lisbon at jlima1@bloomberg.net

To contact the editor responsible for this story: Stephen Foxwell at sfoxwell@bloomberg.net


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