Smartphones Drive New Global Tech Cycle, but Is Demand Peaking?

By Benjamin Carton, Joannes Mongardini, and Yiqun Li

February 8, 2018

 Demand for smartphones is highly cyclical and related to the release of new models (photo: iStock by GettyImages).

Over a decade of spectacular growth, demand for smartphones has created a new global tech cycle that last year produced a new smartphone for every fifth person on earth.

This has created a complex and evolving supply chain across Asia, changing the export and growth performance of several countries. While our recent analysis of Chinese smartphone exports suggests that the global market may be saturated, demand for other electronics continues to support rising semiconductor production in Asia. Continue reading “Smartphones Drive New Global Tech Cycle, but Is Demand Peaking?” »

Countries in the IMF Financial Spotlight in 2018

By IMF Blog

January 31, 2018

Versions in عربي (Arabic),  中文 (Chinese), Français (French), 日本語 (Japanese), Español (Spanish), Русский (Russian)

Financial sector assessments are showing that countries and financial systems are adapting better methods to monitor financial vulnerabilities (photo: Ingram Publishing/Newscom).

The IMF in 2018 will complete ten assessments of countries’ financial systems, to identify risks and propose policies to strengthen their financial stability. Three of this year’s reviews will be for countries with Systemically Important Financial Systems : Belgium, Brazil and Poland. In addition, IMF experts will assess the euro area’s financial stability. Other financial stability assessments will cover Armenia, Jamaica, Namibia, Peru, Romania, and Tanzania.

Continue reading “Countries in the IMF Financial Spotlight in 2018” »

South Africa’s Lesetja Kganyago: Fintech Is a Central Banker’s Friend

By IMFBlog

January 26, 2018 

Lesetja Kganyago, South Africa’s Central Bank Governor and Chairman of the International Monetary and Financial Committee (photo: IMF staff).

While central bankers are often seen as somewhat traditionalist, South Africa’s Reserve Bank Governor Lesetja Kganyago is breaking that mold. Kganyago sees how new technology—or fintech—is transforming the financial sector, and in this podcast, he says there is no turning back. Continue reading “South Africa’s Lesetja Kganyago: Fintech Is a Central Banker’s Friend” »

The Current Economic Sweet Spot Is Not the “New Normal”

By Maurice Obstfeld

January 22, 2018

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Global growth continues to pick up and is broad based. But no matter how tempting it is to sit back and enjoy the sunshine, policy can and should move to strengthen the recovery (photo: Mumbai, India, Ingram Publishing/Newscom).

As the year 2018 begins, the world economy is gathering speed. The new World Economic Outlook Update revises our forecast for the world economy’s growth in both 2018 and 2019 to 3.9 percent. For both years, that is 0.2 percentage points higher than last October’s forecast, and 0.2 percentage points higher than our current estimate of last year’s global growth. Continue reading “The Current Economic Sweet Spot Is Not the “New Normal”” »

Weak Productivity: The Role of Financial Factors and Policies

By Romain Duval, Giuseppe Nicoletti, and Fabrizio Zampolli

January 8, 2018

Auto worker in Mexico: weak productivity has been a problem even before the global financial crisis (photo: Henry Romero/Newscom).

Almost ten years after the onset of the global financial crisis productivity growth remains anaemic in advanced economies despite very easy monetary conditions, casting doubts on the sustainability of the cyclical recovery. The productivity slowdown started well before the crisis, which then amplified the problem. To what extent can this slowdown be ascribed to policies and financial factors, including loose monetary policy prior to 2008, corporate and bank balance sheet vulnerabilities, and the exceptional monetary and financial policy responses to the crisis? Continue reading “Weak Productivity: The Role of Financial Factors and Policies” »

Gamechanger: The Digital Payment Boom in India

By IMFBlog

January 5, 2018

Madhur Deora, CFO of PayTM: Mobile payment platforms in India are providing small loans to people who’ve never had access to credit (IMF photo).

What does a shoe shiner in India have in common with central bankers and finance ministers? They both can appreciate the digital-payment boom. It’s sweeping the world but has accelerated in India, where last November the government demonetized—declaring that 86 percent of the country’s currency in circulation would cease to be legal tender. Continue reading “Gamechanger: The Digital Payment Boom in India” »

Fed Tightening May Squeeze Portfolio Flows to Emerging Markets

By Robin Koepke

December 14, 2017

Versions in  中文 (Chinese),  Español (Spanish),  Français (French), 日本語 (Japanese),  Русский (Russian)

Derivatives traders in Singapore: Tighter Federal Reserve monetary policy is likely to reduce overseas purchases of emerging market stocks and bonds (photo: Caro/Rupert Oberhaeuser/Newscom)

A key question facing global investors today is what impact the US Federal Reserve’s monetary policy normalization process will have on capital flows to emerging markets. The IMF’s new model estimates show that normalization—raising the policy interest rate and shrinking the balance sheet—will likely reduce portfolio inflows by about $70 billion over the next two years, which compares with average annual inflows of $240 billion since 2010. Continue reading “Fed Tightening May Squeeze Portfolio Flows to Emerging Markets” »

Propping Up the Chinese Economy: Credit versus Fiscal Stimulus

By Sophia Chen and Lev Ratnovski

December 13, 2017

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Construction work Qingyuan , Guangdong, China : Fiscal stimulus is a powerful tool for growth (photo: Imagine China/Newscom).

Credit booms are addictive. Credit supports growth and the perception of wealth. Yet credit booms are risky, and are often followed by financial busts and economic slowdowns. The challenge is taming credit without hurting growth. Continue reading “Propping Up the Chinese Economy: Credit versus Fiscal Stimulus” »

Corruption Disruption

By Christine Lagarde

December 8, 2017

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Corruption can have devastating effects on economic growth and stability (photo: Patric Sandri IKON Images/Newscom)

Why does the IMF care so deeply about corruption? The reason is simple. The job of the IMF is to protect global economic stability and promote strong, sustainable, balanced, and inclusive economic growth. And this becomes difficult, if not impossible, to achieve in the presence of entrenched and institutionalized corruption. Continue reading “Corruption Disruption” »

Improving Financial Stability in China

By Ratna Sahay and James P. Walsh

December 6, 2017

Version in  عربي (Arabic), 中文(Chinese), Español (Spanish), Français (French), 日本語 (Japanese), Русский (Russian)

A man walks past a bank branch in Beijing: China’s leaders have made financial stability one of their top priorities (photo: Stephen Shaver/UPI/Newscom).

China’s leaders have made financial stability one of their top priorities. Given the size and importance of the Chinese market, with the world’s largest banks and second-largest stock market, that is welcome news for China and the world. The financial system permeates virtually all aspects of economic activity, having played a key role in facilitating rapid economic growth and in sharply reducing poverty rates.

China is moving from the world’s factory floor toward  a more modern, consumer-driven economy. During this transition, however, some tensions have emerged in the financial sector. Continue reading “Improving Financial Stability in China” »

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