Commodity Prices | IMF Blog

How Policy Makers Can Better Predict a Downturn – and Prepare

October 3, 2017

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

A trading floor in Singapore. Financial conditions provide valuable clues to the economic outlook and can improve the accuracy of forecasts (photo: Caro/Oberhaeuser/Newscom).

The global financial crisis showed that periods of robust growth and seeming calm in financial markets can be followed by a sudden surge in market volatility and an unexpected economic downdraft. That’s why it is so important for policy makers to keep a close watch on so-called financial conditions. These can include everything from bond yields and oil prices to foreign exchange rates and levels of domestic debt. Continue reading “How Policy Makers Can Better Predict a Downturn – and Prepare” »

By IMFBlog| October 3rd, 2017|Advanced Economies, banking, capital markets, commodities, Debt Relief, Economic outlook, Economic research, exchange rates, Financial Crisis, financial policy, Globalization, Government, IMF, inclusive growth, interest rates, International Monetary Fund, Public debt|

A Common Cause for Sustainable Growth and Stability in Central Africa

By Abebe Aemro Selassie

August 1, 2017

Version in Français (French), Português (Portuguese), and Español (Spanish);

Woman with a machete in Bafut, Cameroon: Six countries in Central Africa have a strategy to turn their economies around, with help from the IMF (photo: Heiner Heine/imageBroker/Newscom)

Six countries in central Africa have been hit hard by the collapse in commodity prices. Oil prices dropped, economic growth stalled, public debt rose, and foreign exchange reserves declined. A delayed response from policymakers, and a regional conflict have worsened the situation further for people in the region.

The countries of the Central African Economic and Monetary Community are Gabon, Cameroon, Chad, the Central African Republic, the Republic of Congo, and Equatorial Guinea. They share a common currency—the CFA franc—that is pegged to the euro, and have a common central bank that holds the region’s pool of foreign exchange reserves. Continue reading “A Common Cause for Sustainable Growth and Stability in Central Africa” »

By IMFBlog| August 1st, 2017|Africa, banking, climate change, currency, Debt Relief, developing countries, Economic Crisis, Economic outlook, Environment, Financial markets, Fiscal policy, growth, IMF, inclusive growth, income, International Monetary Fund, LICs, Low-income countries, Migration, oil|

How Flexible Exchange Rates Helped Latin America Adjust to Commodity Price Shocks

By Yan Carrière-Swallow, Nicolás Magud, and Juan Yépez

May 25, 2017

Versions in Português (Portuguese), and Español (Spanish)

(photo: Ivan Alvarado/Reuters/Newscom)

As world prices for Latin America’s key exports—oil, metal, and agricultural products—fell from their super-cycle peak in 2011 and demand from trading partners weakened, export revenues have dropped sharply. Across most of South America, export revenues have fallen by one-third, and by more than half in the case of Venezuela. The size of these shocks has been historic in some cases, ranking among the largest trade price busts faced by emerging economies around the world since 1960. Continue reading “How Flexible Exchange Rates Helped Latin America Adjust to Commodity Price Shocks” »

By IMFBlog| May 25th, 2017|banking, currency, developing countries, Emerging Markets, exchange rates, exports, Financial markets, Latin America, South America|

Restarting the Growth Engine in Sub-Saharan Africa

By IMFBlog

May 19, 2017

Version in Français (French)

The IMF’s latest economic health check of sub-Saharan Africa shows that growth fell to its lowest level in 20 years.

In this podcast, the IMF African Department’s Celine Allard, who oversaw the report, says that this drop brought a halt to the 5 to 6 percent growth rate that was enjoyed in the last two decades. Some factors contributing to this slowdown are lower commodity prices, the devastation of a severe drought—exacerbating crop infestation and leading to a famine affecting some 20 million people—and political conflicts that affect trade.

Continue reading “Restarting the Growth Engine in Sub-Saharan Africa” »

By IMFBlog| May 19th, 2017|Africa, Economic research, exchange rates, financial policy, Fiscal policy, Government, IMF, monetary policy, Public debt, structural reforms, Uncategorized|

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. Continue reading “Commodity Commotion” »

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

Who Wins and Who Loses As China Rebalances

By Serkan Arslanalp, Thomas Helbling, Jaewoo Lee, and Koshy Mathai

Version in 中文 (Chinese)

China’s economy leaves nobody indifferent. The world is watching closely as the second largest economy in the world is shifting its growth model from an export-driven one to one centered on household consumption. As China’s economy slows and rebalances, its impact is being felt on an already fragile global economy, and particularly in the rest of the Asia region. Our recent studies show that while China’s rebalancing will adversely affect some Asian economies, it will also open opportunities for several others.

Continue reading “Who Wins and Who Loses As China Rebalances” »

By IMFBlog| May 12th, 2016|Financial markets, growth, IMF, International Monetary Fund, Investment, technology, Uncategorized|

Alejandro Werner

By Alejandro Werner

(Versions in Español and Português)

It’s been a rough start to 2016, as seen by the recent bouts of financial volatility, stemming from uncertainties related to the slowdown in China, lower commodity prices, and divergent monetary policy in advanced economies.

The global recovery continues to struggle to gain its footing, with strains in some large emerging market economies weighing on growth prospects. For Latin America and the Caribbean, growth in 2016 is now expected to be negative for the second consecutive year—the first time since the debt crisis of 1982–83, which triggered the “lost decade” for the region (see table). Continue reading “Latin America and the Caribbean in 2016: Adjusting to a Harsher Reality” »

By IMFBlog| January 22nd, 2016|Economic outlook, growth, IMF|

Plato & the Incas: Overheard at the IMF’s Annual Meetings

By iMFdirect

According to Plato, you do not really know something unless you can give an account of it. Otherwise, you have just an opinion and not real knowledge. The seminars that took place during the IMF’s Annual Meetings in Lima, Peru would have made Plato proud.

Our editors deployed their pens and notepads and brought back these themes and highlights.

Continue reading “Plato & the Incas: Overheard at the IMF’s Annual Meetings” »

By IMFBlog| October 15th, 2015|Advanced Economies, Annual Meetings, Asia, Economic outlook, Emerging Markets, Financial Crisis, Globalization, IMF, Inequality, International Monetary Fund, Latin America|

If China Sneezes, Africa Can Now Catch a Cold

By Paulo Drummond and Estelle Xue Liu

(Version in 中文)

Growing links with China have supported economic growth in sub-Saharan Africa. But the burgeoning commercial and financial ties between the developing subcontinent and the world’s second-biggest economy carry risks as well. These links also expose sub-Saharan African countries to potentially negative spillovers from China if the Asian giant’s growth slows or the composition of its demand changes.

The old aphorism “If America sneezes, the world catches a cold” referred to the U.S. economy’s role as a locomotive for the global economy, but it can now apply to any symbiotic relationship between a dominant economy and its clients. China has become a major development partner of sub-Saharan Africa. It is now the subcontinent’s largest single trading partner and a key investor and provider of aid.

Continue reading “If China Sneezes, Africa Can Now Catch a Cold” »

By IMFBlog| March 20th, 2014|Africa, Asia, Economic research, Emerging Markets, Fiscal policy, Globalization, growth, IMF, International Monetary Fund, Low-income countries, Uncategorized|

Africa’s Success: More Than A Resource Story

By Antoinette M. Sayeh

When meeting with people outside Africa, I’m often asked whether Africa’s growth takeoff since the mid-1990s has been simply a “commodity story”—a ride fueled by windfall gains from high commodity prices. But finance ministers and other policymakers in the region, and I was one of them, know that the story is richer than that.

In this spirit, in our latest Regional Economic Outlook: Sub-Saharan Africa a team of economists from the IMF’s African Department show that Africa’s continued success is more than a commodity story. In fact, quite a few economies in the region have become high performers without basing their success on natural resources—thanks in no small part to sound policymaking.

Continue reading “Africa’s Success: More Than A Resource Story” »

By IMFBlog| October 31st, 2013|Africa, Economic outlook, Economic research, Emerging Markets, Employment, Financial Crisis, growth, IMF, International Monetary Fund, Low-income countries, Uncategorized|

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