Global Economy Gaining Momentum—For Now

By Maurice Obstfeld

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

Momentum in the global economy has been building since the middle of last year, allowing us to reaffirm our earlier forecasts of higher global growth this year and next. We project the world economy to grow at a pace of 3.5 percent in 2017, up from 3.1 percent last year, and 3.6 percent in 2018. Acceleration will be broad based across advanced, emerging, and low-income economies, building on gains we have seen in both manufacturing and trade.

Our new projection for 2017 in the April World Economic Outlook is marginally higher than what we expected in our last update. This improvement comes primarily from good economic news for Europe and Asia, as well as our continuing expectation for higher growth this year in the United States.

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The Case for Fiscal Policy to Support Structural Reforms

By Angana Banerji, Era Dabla-Norris, Romain Duval, and Davide Furceri

Versions in 中文 (Chinese), Français (French),Deutsch (German), Русский (Russian), and Español (Spanish)

Many advanced countries need  structural reforms to make their economies more productive and raise long-term living standards.  Our new research shows that provided countries can afford it, fiscal policy, through spending or tax incentives, can help governments overcome some obstacles to the reforms, particularly in the early stages.   (more…)

Trade, Labor, and Trust

By iMFdirect

“If we’re fighting each other because we can’t design a system that actually works for everybody, then working people will again continue to mistrust our institutions, and the threat to democracy is very real; you see it.” – Sharan Burrow

Burrow is General Secretary of the International Trade Union Confederation, and in this podcast she says collective action is needed to help better distribute the benefits of growth.  (more…)

By | February 24th, 2017|Gender issues, Globalization, IMF|0 Comments

Big Bad Actors: A Global View of Debt

By Vitor Gaspar and Marialuz Moreno Badia

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

In the midst of the Great Depression, the American economist Irving Fisher warned of the dangers of excessive debt and the deflationary pressures that follow on its tail. He saw debt and deflation as the big, bad actors. Now, their close relatives—too high debt and too low inflation—are still in play, at least for advanced economies.

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The Whole Can Be Greater Than the Sum of its Parts

By Vitor Gaspar, Maurice Obstfeld and Ratna Sahay

There are policy options to bring new life into anemic economic recoveries and to counteract renewed slowdowns.  Our new paper, along with our co-authors, debunks widespread concerns that little can be done by policymakers facing a vicious cycle of (too) low growth, (too) low inflation, near-zero interest rates, and high debt levels.

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G-20: Five Ways to Spark Growth

By iMFdirect

Once again, we face the prospect of weak and fragile global growth. Released earlier this week, the IMF’s update to the global economic outlook expects global growth at 3.1 percent and 3.4 percent in 2016 and 2017, respectively, slightly down from April estimates. The global outlook, which was set for a small upward revision prior to the U.K.’s referendum, has been revised downward, reflecting the increased economic, political, and institutional uncertainty. (more…)

A Spanner in the Works: An Update to the World Economic Outlook

21970901656_57e69fe1e3_zBy Maurice Obstfeld

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

The United Kingdom’s June 23 vote to leave the European Union adds downward pressure to the world economy at a time when growth has been slow amid an array of remaining downside risks. The first half of 2016 revealed some promising signs—for example, stronger than expected growth in the euro area and Japan, as well as a partial recovery in commodity prices that helped several emerging and developing economies. As of June 22, we were therefore prepared to upgrade our 2016-17 global growth projections slightly. But Brexit has thrown a spanner in the works.

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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.”

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The Top Ten Blogs of 2015

by iMFdirect

2015 was a bold year for blogs at the IMF.  Boldness grows less common in the higher ranks, according to Prussian general and military theorist Carl von Clausewitz, but he couldn't be more wrong when it comes to these blogs: the list includes work by the IMF's former chief economist Olivier Blanchard and Vitor Gaspar, head of the Fiscal Affairs Department.

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By | December 30th, 2015|International Monetary Fund|0 Comments
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