"Beware of zeal in the austerity".

Olivier Blanchard, chief economist at the IMFKeywords: excessive austerity, GREECE, EUROPE, Blanchard.

Olivier Blanchard, IMF chief economist, said in The Tribune that no European country has need of "drastic measures that Greece". The increase in the retirement age may, in his opinion, relieve budget problems.
While announcements of plans are increasing rigor in Europe, Olivier Blanchard, chief economist at the International Monetary Fund (IMF), calls for calm In an interview with La Tribune published on Tuesday. After Spain Germany and Great BritainIs the turn of Italy Tuesday to announce further budget cuts. For Olivier Blanchard, the European countries would be wrong to adopt plans of rigor too severe.
"The risk, says the economist, in this case is that under pressure from the markets, some countries do zeal in austerity. It would be a mistake. The markets have long been asleep on the risk budget. Today they woke up and panicked. " He recalled the program and repurchase obligations of the European Central Bank (ECB) has just been put in place to limit the panic on the markets.
An investor panic that is born of the fiscal situation in Greece, but this country is a special case, "said Olivier Blanchard, who also stresses the need relativiserl'importance of the Greek economy, which weighs just finally in the global economy.

The age of retirement, a needed reform:
The Economist continues: "Other European countries do not need to take drastic measures that Greece '. More credible, less debt, they can reduce their deficits gradually, without compromising their growth in the short term.
Olivier Blanchard advance a solution to alleviate the budget problems: pension reform, "indispensable in many countries," Judge said. This reform could pass through "the gradual increase in the age of retirement", as desired by the UMP, or "increasing the contribution period. Thus, the reform "clearly helps to stabilize the budget" and its effect on demand is either zero or positive.