Page last updated at 06:35 GMT, Monday, 7 April 2008 07:35 UK

'Help needed' for credit crunch

Dominique Strauss-Kahn
Mr Strauss-Kahn will head IMF talks in Washington.

Tackling the credit crunch requires government intervention at a global level, the head of the International Monetary Fund (IMF) has said.

The need for public intervention was "becoming more evident", Dominique Strauss-Kahn told the Financial Times.

Authorities have pumped liquidity into markets but, besides bailing out banks such as Northern Rock, have not intervened in financial systems.

The securities market and housing sector could get more support, he said.

This, along with more intervention in the banking sector, would offer a "third line of defence", Mr Strauss-Kahn told the newspaper.

The comments come ahead of a gathering of world financial leaders at the IMF's spring meeting in Washington DC.

Justin Urquhart Stewart of Seven Investment Management said the move proposed by the IMF would need more co-ordinated and effective work between governments.

"We've gone from the idea of the banks just providing access to extra cash, to intervening on odd occasions, then to the final line when were actually saying we're going to have to stand behind this and formally intervene overall in the market to support it," he told the BBC.

"Rather than just waiting for individual banks to go wrong the weaker banks will need further help, and it's going to be more than just access to liquidity."

The BBC is not responsible for the content of external internet sites

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Sign in

BBC navigation

Copyright © 2017 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific