IMF 'too in awe of G7 to spot their failings'

The International Monetary Fund was overly influenced by developed countries including the US and the UK when assessing their economies, and ended up missing signs of fragility that led to the 2008 global financial crisis, an internal audit has found.

"IMF staff felt uncomfortable challenging the views of authorities in advanced economies on monetary and regulatory issues, given the authorities' greater access to banking data and knowledge of their financial markets, and the large numbers of highly qualified economists working in their central banks," the IMF audit, which covered the years 2004 to 2007, said.

Advanced economies were not part of a so-called "vulnerability exercise" to spot crisis-prone countries, according to the IMF report unveiled yesterday. Bloomberg

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