The IMF has called for the Group of 20 to boost growth as it warns of risks to the global economy, from deflation in Europe to high volatility in emerging economies.
Ahead of a meeting of G20 finance ministers and central bankers in Sydney on Saturday, the International Monetary Fund has issued a report saying more coordinated work is needed to keep output expanding and boost demand.
It said advanced economies, which include most of the G20, are still leading a pickup in economic growth overall, but the world economy is still struggling to leave behind the financial crisis that began in 2008.
"The recovery has been disappointing, with G20 output still below longer-term trend," the report said.
"Joint action is needed to boost output and to lower global risks substantially through more balanced growth."
Despite the eruption of more financial turmoil in emerging-market economies last month, the IMF stuck to its forecast of the world's economy expanding 3.7 per cent this year, after a 3.0 per cent pace in 2013.
It said it was assuming the volatility that has unnerved emerging economic powers such as Indonesia, Brazil and South Africa would be short-lived.
But it suggested that also depended upon further reforms in those economies as well as more work to boost demand in advanced countries.
"The recovery is still weak and significant downside risks remain," the Fund said, citing capital outflows, higher interest rates, and sharp currency depreciation in emerging economies as a "key concern".
It said that tighter financial conditions globally, led by the US Federal Reserve's "tapering" of its stimulus, could further undercut growth in a number of countries.
In addition, extremely low inflation in Europe has the IMF worried about how an unanticipated shock to the economy could push the region into deflation, reversing many of the gains of the past year.
