Resolve and Determination—How We Get Out of This Together

Posted on September 27, 2011 by iMFdirect

Coming in to the 2011 Annual Meetings of the IMF and World Bank this past weekend, I had warned of the dangerous new phase for the global economy and had called for bold and collective action. Coming out of the Meetings, 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.

So, looking ahead, follow through—by all concerned—is now even more important. That means taking action not in the years ahead, but in the weeks ahead. And, in that, we are all in this together and we can only get out of it together.

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

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.

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

We are back in the danger zone. Since our previous 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.

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

In the midst of jittery financial markets, and global economic doom and gloom, it’s easy to become pessimistic. Public debt and fiscal deficits in many advanced economies remain very high.

Nevertheless, important progress has been made in fiscal adjustment—the fiscal outlook in most countries is stronger than we expected two years ago. So to the pessimists I say, don’t lose sight of what’s been achieved.

But, to the optimists (if there are any) I say, don’t underestimate what still needs to be done. The task that policymakers face is complicated. They need to ensure the public sector is not a source of instability by committing to a plan that will stabilize and then bring down public debt. At the same time, they need to make sure that fiscal tightening itself does not undermine the recovery.

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

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. 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.

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

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.

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

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 rate among countries when deciding where to invest.

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

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. Inflation peaked in July and was all set to quickly retreat in the latter part of this year.

Unfortunately, just as China appeared to be heading out of the (inflationary) woods, pork happened. An ongoing (and literal) hog cycle caused pork prices to skyrocket. While the hog-cycle will soon turn and the effects should wash out reasonably quickly, the bad news is that the return to more normal times and lower inflation will be postponed once again.

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

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. Some have questioned whether the IMF has a meaningful role to play in these countries, but they couldn’t be more wrong.

A recent review found that the IMF has played an important positive role in fragile states. This doesn’t mean we always got it right. We can do better. There is plenty of scope to adapt how we engage in these countries; to be more flexible and deepen cooperation with other development partners.

In this post, Dominique Desruelle discusses a few ideas that we’ll be exploring—and discussing with stakeholders—in the months ahead, including at a high-level public seminar in Washington later this month.

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

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