"The world economy is looking so troubled that if the US goes in for a very quick move in the middle of this I feel it is going to affect countries quite badly," Kaushik Basu told The Financial Times in an interview on Tuesday.
The Fed "lift-off" in itself is not expected to create a "major crisis, but will cause immediate turbulence," Basu clarified.
The economist noted the rate hike, alongside stumped growth in China, risks touching off "panic and turmoil" in developing markets.
The IMF report dated September 3 projected uncertainty in the recovery of the global markets due to reduced demand in China and other markets, low commodity prices and greater overall market volatility.
The United States has kept its borrowing rates at historic low levels since the beginning of the financial crisis in 2007.