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WASHINGTON : The International Monetary Fund on Thursday welcomed the US government's plans to aid mortgage finance giants Fannie Mae and Freddie Mac and ease the housing crisis.
"The announced measures on Fannie and Freddie go in the right direction and are consistent with approaches that the Fund has supported," IMF spokesman David Hawley said at a news conference.
"And we agree that public sector intervention is warranted, accompanied by improved supervision."
His comments in response to a question came a day after a wide-ranging housing rescue plan sailed through the US House of Representatives and was expected to be approved by the Senate.
The plan, which offers aid to homeowners facing foreclosure and seeks to support mortgage finance giants Fannie Mae and Freddie Mac, cleared a major hurdle before the House vote Wednesday when President George W. Bush dropped his threat to veto the plan, despite some reservations.
The legislation provides some 3.9 billion dollars to help local governments buy and rehabilitate foreclosed homes and permanently boosts the dollar limit for mortgages that can be repurchased by Fannie and Freddie.
It also reforms the oversight of Fannie and Freddie, government-sponsored enterprises (GSEs) which have a congressional charter but are owned by shareholders.
The rescue plan is aimed at supporting a fragile economic recovery that has been held back by housing and credit concerns.
A week ago the IMF slightly lifted its growth forecasts for the world's largest economy in an update of the April World Economic Outlook.
The latest forecast calls for a 1.3 percent expansion in 2008, in the second upward revision in the past month for the United States. In April, the IMF predicted growth of just 0.5 percent but boosted that in June to 1.1 percent.
The IMF maintained its forecast from last month's update of 0.8 percent US growth for 2009. - AFP/de
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