WASHINGTON —  International Monetary Fund chief Christine Lagarde says the world economy is recovering but fragile and "faces some downside risks." In an online press conference, Lagarde describes the United States "a strong performer" and China "resilient" despite a recent drop in Chinese stock prices.



She is also optimistic over the 19 countries that use the euro. "The euro area is beginning to turn the corner ... We have a more upbeat forecast than we have in a long time," she said.



Lagarde called again for Greece's creditors to reduce its debt burden and said the IMF could work with Greece's left-wing government, which has criticized IMF policies.



"There are lots of things that you say (in politics)," she said. "What matters at the end of the day is what you do."



Lagarde also said Wednesday that she is focused more on how Greece acts than what people say about the reforms that creditors press for.



With Athens under pressure to implement more austerity reforms in return for a third EU-IMF bailout program, "what matters is at then end of the day what you do. So deeds, no creeds," Lagarde said in an online press conference.



"What will be critical in my view is what the Greek authorities are actually prepared to do, not... the political noise that is often a necessity."



In the runup to the current negotiations, Greek officials had demonized the IMF as "criminal" for pushing austere policies on the eurozone country during the failed first and second bailouts, and some had said they did not want the Fund to be part of any new rescue operation.



But European Union creditors have said the IMF's role is crucial for any new plan, and last week Athens formally requested a new loan program from the crisis lender.



Lagarde reiterated her view that any new plan requires significant restructuring of the country's debts by the European Commission and the European Central Bank, a view that now has been generally accepted by the creditors. Meanwhile, German business confidence rose slightly in July, reflecting relief in Europe's biggest economy about the deescalation in the Greece debt crisis, the Ifo economic institute said Tuesday.



The Ifo institute's closely watched business climate index rose to 108 points, the first increase in three months, from a revised 107.5 points in June, beating analysts' expectations, Ifo said.



After months of crisis talks and fears Greece would crash out of the euro common currency, eurozone ministers and Athens have agreed to resume talks for a third EU-IMF bailout.



"The preliminary easing of the Greece question has contributed to the improved sentiment in the German economy," Ifo president Hans-Werner Sinn said in a statement.



"Companies' assessments of the situation improved significantly after a damper the previous month. The business prospects too were somewhat more optimistic after three consecutive declines." — Agencies