New ECB chief criticises Germany for low spending

Eurozone countries running budgetary surpluses such as Germany should increase spending to shore up slowing growth in the eurozone, incoming European Central Bank chief Christine Lagarde said .

Lagarde told France's RTL radio that whereas eurozone members had successfully coordinated their fiscal policies to save the bloc during the 2008/2009 sovereign debt crisis, "since then the countries which have budgetary space have not really made the necessary efforts."

She said that "countries with chronic budget surpluses like the Netherlands and Germany and a few others in the world" should loosen their purse strings to help overcome the "current imbalances".

The former IMF chief, who will take over from outgoing ECB head Mario Draghi on Friday, called on those countries to increase spending in infrastructure, education and innovation.

She also echoed French President Emmanuel Macron's repeated calls for greater budgetary solidarity among the 19 countries that share the euro currency -- calls that received a cool response in Germany, the

Netherlands and other northern European countries. "We share a currency but we're not sharing much in terms of budgetary policy at the moment," she said. She said it was "regrettable" that the eurozone did not yet have a common budget.

Meanwhile, Asian markets slipped Wednesday as traders play a wait-and-see game ahead of the Federal Reserve's latest policy decision, with expectations for another interest rate cut but focus also on its plans for the future.

Expectations for another drop in borrowing costs, along with optimism over the ChinaUS trade talks and healthy corporate reports have provided much-needed support to equities of late after a volatile year.

However, while the general consensus is for a third reduction this year, there is a concern that the upbeat earnings, progress on trade and signs of resilience in the US economy could keep the central bank from further measures.

This makes Fed boss Jerome Powell's post-meeting statement crucial, with dealers poring over his every word. "I don't think we should fear a hawkish cut, but I do think one of the things to keep in mind, relative to the prior cut periods, is the Fed starting from a much lower rate.