Enact reforms to counter fickle capital flows: IMF

[WASHINGTON] Increasingly fickle capital flows mean that countries have to implement domestic reforms to protect their stability, the International Monetary Fund's powerful advisory board said on Saturday.

After many emerging economies were hobbled by sharp capital outflows over the past year, the IMF's steering committee, the International Monetary and Financial Committee (IMFC), said that more volatility was to come, especially as the US tightens monetary policy.

IMFC chairman Tharman Shanmugaratnam said that countries have to undertake structural reforms over the medium term to protect themselves as the global economic recovery enters a new phase.