IMF issues Donald Trump tax alert

The IMF has warned that President Donald Trump’s proposed tax cuts and rollback of financial regulations could spark a new round of financial risk-taking of the type that preceded the last crisis in 2008.

The IMF said in its semi-annual Global Financial Stability Report that risks to stability have generally diminished in the last six months amid stronger global economic growth and higher interest rates that have improved bank earnings.

But it said that already highly-leveraged US companies may not be in a position to translate a cash-flow boost from US Republican tax reform proposals into productive capital investments that can aid sustainable growth.