IMF calls for guarantees to unfreeze money mkts

By Jamie McGeever and Simon Rabinovitch

LONDON/BEIJING (Reuters) - Central banks pumped huge amounts of short-term funds into paralysed money markets on Friday as the world's attention turned to Washington where global finance leaders meet this weekend to discuss the deepening crisis.

Investors across all asset classes will look to Group of Seven finance ministers and central bankers, and International Monetary Fund for coordinated action to help arrest the panic that has frozen money markets and sent stock markets into a tailspin.

IMF chief Dominic Strauss-Kahn on Friday called for a temporary guarantee of all interbank deposits.

"This means not only retail bank deposits but probably also interbank and money market deposits, so that activity may restart in these key markets," Strauss-Kahn told a conference in Washington.

"Of course, such a step should be temporary and include safeguards such as heightened supervision and limits on deposit rates offered," he added.

Strauss-Kahn's comments followed another day of turmoil on global financial markets and virtual paralysis on money markets, which had prompted yet more liquidity provisions from monetary authorities around the world.

The European Central Bank and Bank of England injected a combined $132 billion (77.5 million pounds) of one-day and one-week dollar liquidity into the European banking system.

In Asia, Singapore cut interest rates for the first time since 2003 and the Bank of Japan injected a record 4.5 trillion yen ($45.5 billion) in same-day funding.