Resolve and Determination—How We Get Out of This Together

Posted on September 27, 2011 by iMFdirect

By Christine Lagarde

(Versions in  عربي,  中文,  日本語 and Español)

This past weekend, 187 countries came together in Washington D.C. to focus on the economic crisis facing the world.

They were here for the 2011 Annual Meeting of the IMF and World Bank, at which finance ministers and central bank governors mix with businesspeople, civil society, labor leaders, and parliamentarians to discuss the critical issues we face.

Coming in to this Meeting, I had warned of a dangerous new phase now facing the global economy and had called for bold and collective action. Coming out of the Meeting, I feel strongly that the global community is beginning to respond.

Why? Three reasons: a shared sense of urgency, a shared diagnosis of the problems, and a shared sense that the steps needed in the period ahead are now coming into focus. (more…)

Filed under: Advanced Economies, Annual Meetings, Economic outlook, Emerging Markets, growth, IMF, International Monetary Fund, Low-income countries, Multilateral Cooperation | Tagged: , , , , , , , , , , , , , , , , , , , , , , | 71 Comments »

Strong Leadership, Collective Action Key to Economic Recovery

Posted on September 23, 2011 by iMFdirect

By iMFdirect

The 2011 IMF-World Bank Annual Meetings are taking place in Washington DC as the global economy enters a dangerous new phase — financial markets jitters and risks to the recovery are giving everyone plenty to talk about.  Here are our ‘must reads’ for the meetings. (more…)

Filed under: Annual Meetings, Economic outlook, IMF, International Monetary Fund | Tagged: , , , , , , , , , | 4 Comments »

The Danger Zone: Financial Stability Risks Soar

Posted on September 21, 2011 by iMFdirect

By José Viñals

(Versions in عربي, Français, 日本語, and Русский)

We are back in the danger zone. Since the IMF’s previous Global Financial Stability Report, financial stability risks have increased substantially—reversing some of the progress that had been made over the previous three years.

 Several shocks have recently buffeted the global financial system: unequivocal signs of a broader global economic slowdown; fresh market turbulence in the euro area; and the credit downgrade of the United States.

This has thrown us into a crisis of confidence driven by three main factors: weak growth, weak balance sheets, and weak politics. (more…)

Filed under: Economic research, Europe, Financial Crisis, Financial regulation, Financial sector supervision, IMF, International Monetary Fund | Tagged: , , , , , , , , , , , , , , , , | 9 Comments »

Fiscal Glass is Half Full: Some Reasons for Optimism

Posted on September 21, 2011 by iMFdirect

By Carlo Cottarelli

(Versions in عربي, Français, 中文 and  Русский)

In the midst of jittery financial markets, and global economic doom and gloom, it’s easy to become pessimistic. Perhaps too much so; amid what seems like a steady drum beat of bad news, one can lose sight of what has been  achieved over the last couple of years.

Public debt and fiscal deficits in many advanced economies remain very high. Nevertheless, important progress has been made in fiscal adjustment in many advanced economies. For most countries, government deficits have fallen substantially—by 2¼ percentage points of GDP on average compared to two years ago.


The fiscal outlook in most countries is stronger than we expected two years ago. (more…)

Filed under: Advanced Economies, Economic outlook, Economic research, Fiscal policy, IMF, International Monetary Fund | Tagged: , , , , , , , , , , , | 1 Comment »

Weak Global Economy Tops Agenda at IMF-World Bank Gathering

Posted on September 19, 2011 by iMFdirect

By iMFdirect

Recent turbulence in financial markets and increased risks in the global economy mean that the 2011 Annual Meetings of the IMF and World Bank are taking place at a critical time for the global economy.

Economic leaders will come together to assess the state of the world economy and discuss the policy actions needed to deal with today’s global economic challenges. The IMF’s updated forecast for the world economy will be published September 20.

About 10,000 policymakers, private sector and civil society representatives, journalists, and academics are expected to attend the Annual Meetings, which are set to take place on September 23–24.

In an interview, Reza Moghadam, Director of the IMF’s Strategy, Policy, and Review Department, discusses the issues that are likely to receive most attention at the meetings. (more…)

Filed under: Advanced Economies, Annual Meetings, Civil Society, Economic Crisis, Emerging Markets, Financial Crisis, IMF, International Monetary Fund, Low-income countries | Tagged: , , , , , , , , , , , , , , , , , , | 4 Comments »

Haves and Have Less—Why Inequality Throws Us Off Balance

Posted on September 14, 2011 by iMFdirect

Jeremy CliftBy Jeremy Clift

We used to think that overall economic growth would pull everyone up. While the rich might be getting richer, everyone would benefit and would see higher living standards. That was the unspoken bargain of the market system.

But now research is showing that, in many countries, inequality is on the rise and the gap between the rich and the poor is widening, particularly over the past quarter-century.

With taxpayers footing the bill for troubles in the financial industry in advanced economies during the global economic crisis, this discrepancy seems particularly galling to wage-earners who have seen their pay stagnate or worse. Inequality has started to attract more research by economists.

The September 2011 issue of Finance & Development (F&D) looks at income inequality around the world and how it matters. (more…)

Filed under: IMF, Inequality, International Monetary Fund | Tagged: , , , , , , , , , , , , | 3 Comments »

Interest Rates and Investor Decisions: The Long and Short of It

Posted on September 13, 2011 by iMFdirect

By Erik Oppers

What drives the investment decisions of investors with a longer time horizon? Our research found these investors generally do not look at differences in interest rates among countries when deciding where to invest.

It turns out the factors they do consider in making these decisions are good and stable growth prospects, low country risks—including political and economic stability—and a stable exchange rate. This all makes good sense for long-term investors such as pension funds and insurance companies.

So why all this talk about how low interest rates in advanced economies are “pushing” investment flows to emerging countries, where interest rates are generally higher—is this story wrong? (more…)

Filed under: Advanced Economies, Emerging Markets, IMF, International Monetary Fund | Tagged: , , , , , , , , , , , , , , , , | 2 Comments »

Darn Them Piggies! Pork Prices & the Inflation Outlook for China

Posted on September 11, 2011 by iMFdirect

By Nigel Chalk

(Version in 中文)

It was pretty clear to me on a recent visit that China has become one of the biggest global markets for Angry Birds. The game was everywhere and around 100 million Chinese downloads are expected this year. It made me wonder if this was somehow linked to rising concerns over inflation and a way of getting back at those (increasingly expensive) mischievous green pigs.

During the past year, views on China’s economy have yo-yoed from concerns about the recovery, to hand-wringing about inflation and overheating, and then back to talk of hard landing.

Certainly inflation has been a key feature of the environment this year in China and one should pay close attention to it. Rising inflation is a crucial social concern and takes a heavy toll on household incomes that are already struggling to keep up with economic growth. (more…)

Filed under: Asia, Economic outlook, Emerging Markets, IMF, International Monetary Fund, 中文 | Tagged: , , , , , , , , , , , , , , , , | 2 Comments »

Heartbreak and Hardship—Finding a Way Out for Fragile States

Posted on September 7, 2011 by iMFdirect

By Dominique Desruelle

War-torn Iraq, quake-ravaged Haiti, conflict-devastated Sierra Leone. So many countries around the world face the legacy of terrible hardships that have left them scarred and fragile.

Everyone agrees that countries need help to recover from these situations. But it is not easy to come to a shared understanding on what this really takes.

Some have questioned whether the IMF has a meaningful role to play. They argue that engagement in fragile states—countries with weak institutions and infrastructure, internal conflict, and governments that face difficulties delivering core services to the population—should mainly be left to bilateral donors and development institutions.

And they couldn’t be more wrong. Helping a country’s economy to work better—the IMF’s core expertise—is a central building block to move beyond fragile situations and achieve better lives for its citizens. (more…)

Filed under: concessional lending, IMF, International Monetary Fund, LICs, Low-income countries | Tagged: , , , , , , , , , , , , , , , | 1 Comment »

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