Private Debt to Weigh on Global Economic Recovery
A record rise in private debt could slow the economic recovery, but the drag on growth will vary across countries and within them.
The Resilience of Private Balance Sheets in Europe during COVID-19
By Estelle Xue Liu, Karim Foda, and Sebastian Weber
One of the positive surprises about last year’s recession is how little damage it inflicted on average household and corporate balance sheets in Europe. […]
Transparency Makes Central Banks More Effective and Trusted
By Tobias Adrian, Ghiath Shabsigh, and Ashraf Khan
عربي, 中文, Español, 日本語, Русский
The role and mandates of central banks have become broader and more complex since the 2008 global financial crisis. […]
The Wealth of Nations: Governments Can Better Manage What They Own and Owe
By Vitor Gaspar, Jason Harris, and Alexander Tieman
October 10, 2018
عربي,中文, Español, Français, Baˈhasa indoneˈsia, 日本語, Português, Русский
A firefighter in Auckland, New Zealand: when governments know what they own they can put their assets to better use and can earn about 3 percent of GDP more in revenues to spend on citizens’ well being (Photo: Rafael Ben-Ari/Newscom)
What is the state of your personal finances? You probably think first about your debts: your mortgage, your credit card balance, and your student loans. But you probably also think about how much cash is sitting in the bank, the value of your house, and the rest of your nest egg.
Surprisingly, most governments do not approach their finances this way. […]
Top 5 Blogs on Finance
By IMFBlog
September 11, 2018
A guard stands outside former US investment bank Lehman brothers (photo: Frances M. Roberts/Newscom)
The tenth anniversary of the collapse of US investment bank Lehman Brothers and the global crisis that followed is a sober reminder of what has changed, and what has not, in the world of economics and finance. […]
An Imbalance in Global Banks’ Dollar Funding
By John Caparusso, Yingyuan Chen, Hideo Hashimoto, David Jones, Will Kerry and Aki Yokoyama
June 12, 2018
Versions in Español, Deutsche, Français, 日本語, Português
The US Treasury is issuing more T-bills, potentially putting upward pressure on the interest rates non-US banks must pay for short-term dollar funding (photo: Jennifer Hack/KRT/Newscom)
For companies and investors outside the United States, the dollar is often the currency of choice. Surprisingly, though, US banks play only a limited role in lending dollars to international borrowers. Most of the $7 trillion in banks’ dollar lending outside the United States is handled by banks based in Europe, Japan and elsewhere. […]
What Advanced Economies Can Do to Rise Above the “New Mediocre”
By Era Dabla-Norris, Vikram Haksar, and Kalpana Kochhar
Global growth remains anemic more than five years after the global financial crisis. If nothing is done, the prospect of settling into a “new mediocre” will become reality, especially in advanced economies.
In many advanced economies, accommodative monetary policies, growth-friendly fiscal frameworks, and efforts to tackle private debt overhang and improve tax revenues and compliance are essential to lift economic growth in the short term.
Legacies, Clouds and Uncertainties
(Versions in Français, español, 中文, Русский, 日本語)
The recovery continues, but it is weak and uneven.
You have now seen the basic numbers from our latest projections in the October 2014 World Economic Outlook released today. We forecast world growth to be 3.3% in 2014, down 0.1% from our July forecast, and 3.8% in 2015, down 0.2% from our July forecast.
This number hides however very different evolutions. Some countries have recovered or nearly recovered. But others are still struggling.
Looking around the world, economies are subject to two main forces. One from the past: Countries have to deal with the legacies of the financial crisis, ranging from debt overhangs to high unemployment. One from the future, or more accurately, the anticipated future: Potential growth rates are being revised down, and these worse prospects are in turn affecting confidence, demand, and growth today.
Because these two forces play in different countries to different degrees, economic evolutions are becoming more differentiated. With this in mind, let me take you on the […]
Euro Area – Q&A on QE
By Reza Moghadam and Ranjit Teja
As inflation has sunk in the euro area, talk of quantitative easing (QE)—and misgivings about it—have soared. Some think QE is not needed; others that it would not work; and yet others that it only creates asset bubbles and may even be “illegal.” In its latest report on the euro area, the IMF assesses recent policy action positively but adds that “… if inflation remains too low, the ECB should consider a substantial balance sheet expansion, including through asset purchases.” Given all the reservations, would the juice be worth the squeeze?
Slowdown in Emerging Markets: Not Just a Hiccup
By Evridiki Tsounta and Kalpana Kochhar
(Versions in Español)
Emerging market economies have been experiencing strong growth, with annual growth for the period 2000-12 averaging 4¾ percent per year—a full percentage point higher than in the previous two decades. In the last two to three years, however, growth in most emerging markets has been cooling off, in some cases quite rapidly.
Is the recent slowdown just a hiccup or a sign of a more chronic condition? To answer this question, we first looked at the factors behind this strong growth performance.
Our new study finds that increases in employment and the accumulation of capital, such as buildings and machinery, continue to be the main drivers of growth in emerging markets. Together they explain 3 percentage points of annual GDP growth in 2000–12, while improvements in the efficiency of the inputs of production—which economists call “total factor productivity”—explain 1 ¾ percentage points (Figure 1).