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Geithner says need to keep stimulus on



07 November 2009 @ 11:16 am ET

ST ANDREWS, Scotland - U.S. Treasury Secretary Timothy Geithner said high unemployment rates show that economic recovery is still perilous and governments need to maintain stimulus as long as necessary to ensure sustained growth.


Britain's Chancellor of the Exchequer Darling chats with US Treasury Secretary Geithner as they gather for the family photo at the G20 Finance Ministers meeting in St. Andrews
Britain's Chancellor of the Exchequer Alistair Darling (R) chats with U.S. Treasury Secretary Timothy Geithner as they gather for the family photo at the G20 Finance Ministers meeting at a hotel in St. Andrews, Scotland, November 7, 2009. (REUTERS / Andrew Winning)
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"If we put the brakes on too quickly we will weaken the economy and the financial system, unemployment will rise, more businesses will fail, budget deficits will rise, and the ultimate cost of the crisis will be greater," Geithner said in a statement issued at the conclusion of a two-day Group of 20 meeting.

He said that with some growth beginning to become apparent in the global economy, policymakers were faced with new challenges but had to avoid taking actions that could snuff out recovery.

"It's too early to start to lean against recovery," Geithner said.

"With growth now underway and the financial fires winding down, the policy challenge is changing. The first stage was the emergency rescue," Geithner said. "The next stage was catalyzing private demand and business investment. This will require continued policy support."

(Reporting by Glenn Somerville and Sujata Rao)

Copyright 2009 Thomson Reuters. All rights reserved.

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