IMF Chief Lagarde comment on global economy at AP meeting

EDIT STARTS AND ENDS ON SOUNDBITE 1. SOUNDBITE (English) Christine Lagarde, Managing director of the International Monetary Fund: STORYLINE The managing director of the International Monetary Fund said on Tuesday that the global economy is making some advances in digging itself out of a punishing recession, but that the recovery remains very fragile, especially in Europe. She suggested cutting government spending too quickly in developed countries like the United States and larger European nations could make things worse, not better. Lagarde said the global economy is making some advances in digging itself out of a punishing recession, but that the recovery remains very fragile, especially in Europe. She suggested cutting government spending too quickly in developed countries like the United States and larger European nations could make things worse, not better. Policy-makers on both sides of the Atlantic need "breathing space to finish the job," Christine Lagarde said in prepared remarks to the Associated Press Annual Meeting. Lagarde also said that Europe's faltering would quickly spread and the US recovery, slowly gaining strength, "might well be in jeopardy." She said that "America has a large stake" in how Europe and the rest of the world fares. Lagarde said it is important to continue and expand emergency programs among the 17 countries that use the euro to help heavily indebted countries there. Her remarks came after the Eurozone countries on Friday boosted their emergency bailout funds for heavily indebted by 1.1 (t) trillion US Dollars. That was short of what Lagarde and other international leaders have said is needed to calm financial markets. She suggested that bold steps are needed such as those taken by the US Federal Reserve and the European Central Bank to help "keep growth strong and steady." She said, most countries are running deficits that are too high and "need to bring down debt over time. And, yes, some countries under pressure have no choice but to cut deficits today. But a global undifferentiated rush to austerity will prove self-defeating. Countries like the united States with low costs of borrowing should not move too quickly." Those remarks thrust her into the US presidential debate, where Republicans are united in calling for deep cuts in federal spending, while President Barack Obama, who was to address the Associated Press meeting later on Tuesday, and congressional Democrats are calling for more job-creating spending, along with raising taxes on the wealthy to help trim budget deficits now exceeding 1 (t) trillion a year. Lagarde, noting that over 200 (m) million people globally, including nearly 13 (m) million in the US, are without work, declared, "jobs must be a priority." You can license this story through AP Archive: http://www.aparchive.com/metadata/youtube/b3153793765c108707e14143fdde3873 Find out more about AP Archive: http://www.aparchive.com/HowWeWork