Central banks act as economy hits 'dangerous new phase'

 

Five central banks have moved to boost the liquidity of commercial lenders, as the boss of the International Monetary Fund warns of a "dangerous" new economic threat.

The central banks will provide the commercial banks with three additional tranches of dollar loans to provide ease funding pressures.

Banking stocks growing sharply, with BNP Paribas up as much as 22%.

IMF managing director Christine Lagarde said "bold steps" was needed.

Speaking in Washington, she said: "Uncertainty hovers over sovereigns across the advanced economies, banks in Europe, and households in the United States.

"Without collective, bold, action, there is a real risk that the major economies going back instead of moving forward."