WASHINGTON (AP) — The head of the International Monetary Fund is warning that the healthiest global economy in years is being threatened by rising debt levels and a simmering trade dispute between the world's two biggest economies.

IMF Managing Director Christine Lagarde told reporters a U.S.-China trade war "will not be something that will affect only the two countries because the world is so interconnected. It will affect the global economy."

For now, the IMF expects the global economy to grow 3.9 percent this year, the fastest since 2011. But Lagarde says "we are seeing more clouds accumulating on the horizon." She cited trade tensions and rising global debts, which have hit a record $164 trillion. She noted that government debt in advanced economies is at the highest level since World War II.