IMF's Lagarde denies discussion with Spain, Italy

“We have had no discussions whatsoever with Italy and Spain to negotiate any kind of problem. I hear some wonderful rumors ... I can tell you that there is no such plan underway,” the head of the International Monetary Fund told a news conference in Mexico City.

“We stand ready to help, not just countries of the eurozone but also those that we call the crisis bystanders,” said the IMF chief during a two-day visit to Mexico.

Lagarde lauded the announcement by the world's biggest central banks Wednesday to provide banks with funds and prop up the global financial system in the face of the eurozone crisis.

“The IMF can only welcome such concerted actions. When central bankers take decisive, concerted actions it's usually extremely efficient, well received by the markets and produces immediate effects and this is what we're seeing,” Lagarde said at a conference also attended by Mexican central bank chief Agustin Carstens and Finance Minister Jose Antonio Meade.

Stocks around the world spiked sharply in response to the central banks' announcement, clearly aimed at easing the strain on European banks which have struggled to raise dollars on the markets for months over concerns about the eurozone debt crisis.

“I'm sure that European leaders as well as other leaders ... will also understand that timing is of the essence and that there has to be an urgent resolution of the current crisis,” Lagarde said.

European Union finance ministers earlier admitted that EU governments could not save the eurozone on their own after they failed to ramp up their own bailout fund to 1 trillion euros.

A critical Dec. 8-9 EU summit was set to focus on tightening budgetary and debt discipline, including a possible change in the EU's treaties or pacts that could trigger a split within the 17-nation eurozone.

The talks were also expected to look at securing help from the IMF, which has limited resources, and the potentially unlimited firepower of the European Central Bank (ECB).

Mexican central bank chief Carstens said Wednesday that Mexico would use its leadership of the Group of 20 (G-20) most powerful nations, which it assumes Thursday, to help boost the IMF's clout for the future.

“It will certainly be one of the major tasks for the Mexican presidency,” said Carstens, who lost out to Lagarde for the top IMF job this year.

Lagarde discussed Mexico's “ambitious G-20 agenda” with President Felipe Calderon on Wednesday and was due to visit Brazil on Thursday.

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