Economic rebound to come from US housing market: IMF head

PARIS: The world will begin to emerge from the economic crisis in the first quarter of 2010, and the recovery will start in the US housing market, the head of the International Monetary Fund (IMF), Dominique Strauss-Kahn, was quoted on Monday as saying.

"The crisis began in the United States, in the housing sector. The recovery will announce itself first in the United States. Therefore we must keep an eye on American real estate prices. The end of the fall in prices will be an important sign," Strauss-Kahn told the daily Le Figaro.

In an interview published on the daily's online edition, the IMF head also noted that US housing prices were very close to bottoming out. "That is why we foresee the recovery for the first quarter of 2010," he said.

Another important indicator would be the status of industrial inventories, Strauss-Kahn said. "When the destocking ends, production can resume," he said.

According to the IMF head, the recovery of credit markets was also an essential factor in the recovery. "They are still frozen," Strauss-Kahn said.