10/08/2013 09:36 am ET | Updated Dec 08, 2013

IMF Chief Economist: U.S. Default Would Likely Cause Recession


WASHINGTON, Oct 8 (Reuters) - A default by the United States would like lead to a recession "or even worse," the chief economist at the International Monetary Fund said on Tuesday.

IMF chief economist Olivier Blanchard said a failure to lift the nation's debt ceiling would lead to dramatic cuts in government spending and "probably ... a lot of financial turmoil."

"I think what could be said is if there was a problem lifting the debt ceiling, it could well be that what is now a recovery would turn into a recession or even worse," Blanchard said.


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