The International Monetary Fund on Wednesday pressed debt-laden Japan and the United States to make more progress in mapping out medium-term fiscal consolidation plans to ensure financial stability and preserve market confidence.
"Much greater progress on medium-term fiscal consolidation strategies will be needed in both the United States and Japan to avoid downside risks to financial stability and to preserve confidence," the IMF's semiannual Global Financial Stability Report said.
"Despite ongoing economic recovery and improvements in global financial stability, structural weakness and vulnerabilities remain in some important financial systems," the report said.
The report also noted the most pressing challenge in the next few months is "the funding of banks and sovereigns, particularly in some vulnerable area countries."