Fallout from the global financial crisis is not over and more consolidation could occur in the financial sector, IMF Managing Director Dominique Strauss-Kahn said on Monday. "The consequences of the financial crisis are not over but . the root causes are for a large part behind us," he told a news conference.
Central banks mobilised world-wide on Monday as stocks and the US dollar sank after the bankruptcy filing of Lehman Brothers and sale of Merrill Lynch - Wall Street giants which many people once considered too big to fail. "Probably we will see consolidation in the financial sector," Strauss-Kahn said. "The financial sector after the crisis will be smaller."
But he said the global economy had proved more resilient than had been expected and could recover in 2009. "The IMF is seeing the world recovery sometime in 2009," he said in earlier remarks. He also said he expected commodity prices to fall back from high levels this year and that US housing prices would likely find a bottom and recover.