IMF's Olivier Blanchard urges UK austerity rethink

The International Monetary Fund's twice-yearly look at the world economy has lowered its forecasts for most developed economies, including the UK.

The IMF said world growth would now be 3.3% for the year, down from 3.5% forecast six months ago.

For the UK, it is forecasting growth of just 0.7%, after saying a month ago that the country's economy could expect 1% growth.

Meanwhile, the IMF's chief economist, Olivier Blanchard, has suggested that Chancellor George Osborne should rethink his economic plans in light of the continuing weakness of the UK economy.

"There is a point at which you actually have to sit down and say maybe our assumptions were not right and maybe we have to slow down", he said.