Watchdog: IMF response to European crisis 'uneven'

WASHINGTON (AP) - The International Monetary Fund was unprepared for the debt crisis that hit Europe and was slow to press for debt relief that might have eased Greece's economic pain and allowed it to pay its bills, an IMF watchdog says.

In a report released Thursday, the Independent Evaluation Office declared the IMF's response "uneven." The watchdog also suggested the fund's decision-making was vulnerable to political pressure - a charge IMF chief Christine Lagarde rejected.

The 2008 financial crisis left European countries with enormous debts and weak banks. As part of a so-called troika with the European Commission and the European Central Bank, the IMF bailed out Greece, Ireland and Portugal in 2010-11.

IMF policymakers, used to assisting poor, developing world countries, "did not foresee the magnitude of the risks" in wealthy Europe. Their "'Europe is different' mindset" prevented them from realizing investors would react to the debt problems by dumping European bonds, driving up interest rates in troubled countries and making their debt problems worse, the evaluation office said.