BERLIN--The head of the International Monetary Fund warned Tuesday that inflation rates in the euro zone and other leading economies are too low and pose a risk in the outlook for the global economy.
The comments highlight growing concern as to whether the euro zone might be heading toward deflation. Inflation reached just 0.7% in the 18-member bloc, far below the European Central Bank's target of just under 2%.
"In terms of risks that we see on the horizon, one is the sustainably low--too low--inflation, particularly in the euro area but more generally in the advanced economies," said IMF Managing Director Christine Lagarde during a news conference with Chancellor Angela Merkel and the leaders of the world's main economic organizations here in Berlin.
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