With Global Financial Markets, How Much Control Do Countries Have Over Economic Policies?

By Selim Ali Elekdag and Gaston Gelos

Versions in عربي (Arabic), Français (French), Русский (Russian), and Español (Spanish)

The outlook for further interest-rate increases by the US Federal Reserve revives interest in a compelling question: In an increasingly integrated global financial system, how much control do countries outside of the US retain over their economic policies?

  (more…)

Services Exports Open a New Path to Prosperity

By Prakash Loungani, Chris Papageorgiou, and Ke Wang

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

Services, which already account for 50 percent of world income and 70 percent of employment, are also becoming an important part of international trade. Services exports—accounting for nearly one fourth of total exports—have come to play a central role in the global economy, thanks in large part to advances in technology. (more…)

Maintaining the Positive Momentum of the Global Economy

Lagarde.2015MDPORTRAIT4_114x128By Christine Lagarde

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

Baden-Baden, the German spa town built on ancient thermal springs, is a fitting venue to discuss the health of the global economy during this week’s meeting of the Group of Twenty finance ministers and central bank governors.

Policymakers will likely share a sense of growing optimism, because the recent strengthening of activity suggests that the world economy may finally snap out of its multi-year convalescence.  (more…)

By | March 14th, 2017|Advanced Economies, G-20, growth, IMF, Investment, jobs, U.S., Uncategorized|0 Comments

Revisiting the Paradox of Capital: The Reversal of Uphill Flows

By Emine Boz, Luis Cubeddu, and Maurice Obstfeld

Versions in عربي (Arabic),  中文 (Chinese), Français (French),  Русский (Russian), and Español (Spanish)

Basic economic theory tells us that capital should flow from slow-growing rich countries to faster-growing poor ones in search of higher returns. A decade ago, our former Research Department colleagues Eswar Prasad, Raghuram Rajan, and Arvind Subramanian examined why the reverse had been true—capital generally flowed “uphill” from poorer to richer countries. Building on the seminal work of Robert Lucas, they argued that certain characteristics of poorer countries, such as weaker institutions and lower levels of education, may reduce the risk-adjusted returns to investing there.  (more…)

Chart of the Week: More Women, More Growth

By iMFdirect

International Women’s Day and the United States’ February jobs report are both coming up this week. So, we decided today’s chart should focus on women and work.

Around the world, women seeking employment face barriers—from legal hurdles to disincentives like lower wages. Leveling the playing field could bring significant benefits.  (more…)

By | March 6th, 2017|Gender issues, health, IMF, income, U.S., wages|0 Comments

Have Data—Will Travel

By iMFdirect

Author and innovation guru, Alec Ross says that technology is shaping the industries of the future.

“Ninety percent of the world’s data has been produced in the last two years. In fact, if you take the sum of all the information produced by human kind—from paintings on cave walls—to the year 2003, the sum of that data we now produce every two days.”  (more…)

By | March 3rd, 2017|commodities, IMF, trade, U.S.|0 Comments

A Shifting Global Economic Landscape: Update to the World Economic Outlook

maury-obstfeld-blogsize-final2By Maurice Obstfeld

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

Today we released our update to the World Economic Outlook.

An accumulation of recent data suggests that the global economic landscape started to shift in the second half of 2016. Developments since last summer indicate somewhat greater growth momentum coming into the new year in a number of important economies. Our earlier projection, that world growth will pick up from last year’s lackluster pace in 2017 and 2018, therefore looks increasingly likely to be realized. At the same time, we see a wider dispersion of risks to this short-term forecast, with those risks still tilted to the downside. Uncertainty has risen.  (more…)

The Top Ten Blogs of 2016

by iMFdirect

What a year it has been.  12 months with big implications for the global economy.

In 2016 our readers’ curiosity focused on a wide range of hot topics in the world of economic and financial policy: the economic impact of migration, China’s economic transition, the prospects for negative interest rates, the way forward for Greece, the future of commodity prices, and the outlook for Latin America, to name a few.  We compiled this top ten list for the past year based on readership.  (more…)

Commodity Commotion

By iMFdirect

Terms of trade is the price of a country’s exports relative to its imports. The commodity terms of trade refers to a country’s commodity exports relative to its commodity imports.

When the price of commodities, like oil, plummeted in 2015, economies that rely on exporting commodities had their terms of trade drop by an average of about 10 percent of GDP that year. Economies that rely more on importing commodities saw about a 2 percent of GDP benefit from the 2015 drop in prices.  (more…)

By | December 21st, 2016|commodities, Economic research, IMF, International Monetary Fund, U.S.|0 Comments

A Shifting U.S. Policy Mix: Global Rewards and Risks

maury-obstfeld-imfBy Maurice Obstfeld

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

After a year marked by financial turbulence, political surprises, and unsteady growth in many parts of the world, the Fed’s decision this month to raise interest rates for just the second time in a decade is a healthy symptom that the recovery of the world’s largest economy is on track.

The Fed’s action was hardly a surprise: markets had for weeks placed a high probability on last week’s move. But market developments preceding the Fed decision did surprise many market watchers. (more…)

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