Chart of the WeekGlobal Inflation Pressures Broadened on Food and Energy Price Gains
Inflation continued rising around the world through the second half of last year, driven by several factors of varying importance across regions.
Chart of the WeekLonger Delivery Times Reflect Supply Chain Disruptions
By Parisa Kamali and Alex (Shiyao) Wang
Supply chain disruptions have become a major challenge for the global economy since the start of the pandemic. […]
Limiting the Economic Fallout of the Coronavirus with Large Targeted Policies
This blog is part of a special series on the response to the coronavirus.
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This health crisis will have a significant economic fallout, reflecting shocks to supply and demand different from past crises. Substantial targeted policies are needed to support the economy through the epidemic, keeping intact the web of economic and financial relationships between workers and businesses, lenders and borrowers, and suppliers and end-users for activity to recover once the outbreak fades. The goal is to prevent a temporary crisis from permanently harming people and firms through job losses and bankruptcies. […]
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. […]
It’s Mostly Food: How to Tame Indian Inflation
By Rahul Anand and Paul Cashin
After being low for decades, inflation in India trended higher from the mid-2000s. It reached 10–11 percent by 2008, and remained elevated at double digits for several years. Even though inflation fell by almost half in 2014, inflation expectations have remained high.
High and persistent inflation in recent years has presented serious macroeconomic challenges in India, increasing the country’s domestic and external vulnerabilities. As Reserve Bank of India Governor Raghuram Rajan pointed out at the 8th R.N. Kao Memorial Lecture in 2014, “inflation is a destructive disease … we can’t push inflation under the carpet as a central banker. We have to deal with it.”
A Missing Piece In Europe’s Growth Puzzle
Even before the latest euro area GDP numbers and Italian elections cast a shadow over the continent, economists were struggling to reconcile the steady improvement in market sentiment with the more downbeat data on the economy, production, orders, and jobs.
This video looks at this puzzle from a somewhat different perspective than the usual— we examine the role of household and corporate balance sheets in the countries under financial market stress and the implications for policy priorities.
The Ties That Bond Us: What Demand For Government Debt Can Tell Us About the Risks Ahead
It has become apparent in recent years is that advanced economy government bond markets can also experience investor outflows, and associated runs.
Our new research shows that advanced economies’ exposure to refinancing risk and changes in government borrowing costs depend mainly on who is holding the bonds— the demand side for government debt.
Tracking who owns what, when and for how long can shed some light on potential risks in advanced economies’ government debt markets.
Building on Latin America’s Success
Next week, I will travel to Chile and Colombia—my second visit to the region since November 2011. I return with increased optimism, as much of Latin America continues its impressive transformation that started a decade ago.
Mind The Gap: Policies To Jump Start Growth in the U.K.
The effects of a persistently weak economy and high long-term unemployment can reverberate through a country’s economy long into the future—commonly referred to by economists as hysteresis. Our analysis shows that the large and sustained output gap, the difference between what an economy could produce and what it is producing, raises the danger that a downturn reduces the economy’s productive capacity and permanently depresses potential GDP.