Dominique Strauss-Kahn, managing director of the International Monetary Fund, on Sunday welcomed the $700bn US rescue plan as a priority in the fight to “put out the fire” engulfing the banking system.

Mr Strauss-Kahn, speaking to France’s Journal du Dimanche newspaper, said the plan should be a first step towards reform of the global financial system, as he called for greater regulation of financial institutions and markets.