Posted on January 30, 2014 by iMFdirect
By Alejandro Werner
(Version in Español, Português)
Looking to the year ahead, how do we see the global economic landscape, and what will this mean for our region? This question is especially on people’s minds today, given the risks of deflation in advanced economies and of sustained turbulence in emerging markets.
Despite these risks, we expect that the region will grow a little faster than last year—increasing from 2.6 percent in 2013 to 3 percent in 2014. Stronger global demand is one part of the story, but not the whole story; volatility is likely to be a significant feature of the landscape ahead. And regional growth rates will still be in low gear compared to historical trends, and downside risks to growth remain. So, let’s start with the global scene.
Filed under: Economic outlook, Economic research, Emerging Markets, Employment, Financial Crisis, growth, IMF, International Monetary Fund, Latin America | Tagged: Alejandro Werner, Argentina, Brazil, Caribbean, Central America, Chile, Colombia, financial market, inflation, Latin America, Mexico, Peru, South America, tourism, United States, Uruguay, Venezuela, Western Hemisphere | Leave a comment »
Posted on January 28, 2014 by iMFdirect
By Christine Lagarde
(Version in Français and Español)
As we begin the new year, Europe confronts both good and bad news. First the good news. Growth is finally picking up in the euro area as it is slowly emerging from the deep recession. The bad news? Still nearly 20 million people are unemployed. Until the effects on employment have been reversed, we cannot say that the crisis is over.
Two trends are particularly troubling, now and for the future. First, the high level of long-term unemployment gives me great cause for concern: almost half of those without a job have been unemployed for more than a year. Second, I still worry about the large number of young people without jobs: nearly one quarter of Europeans under the age of 25 who are looking for a job cannot find one. In Italy and Portugal, more than one third of under-25s are unemployed, and in Spain and Greece more than one half are.
Filed under: Advanced Economies, Economic research, Employment, Europe, Financial Crisis, Fiscal policy, growth, IMF, International Monetary Fund | Tagged: book launch, Christine Lagarde, Czech Republic, euro area, Europe, Germany, labor market, Slovakia, Spain, unemployment | Leave a comment »
Posted on January 24, 2014 by iMFdirect
The IMF’s Christine Lagarde is in Brussels on January 28 to talk about jobs and growth in Europe.
The good news is growth is finally picking up in the euro area as it is slowly emerging from the deep recession. But nearly 20 million people are unemployed.
The most effective way of boosting jobs is to get growth going again.
The IMF has a new book that analyzes today’s challenges head-on and proposes a roadmap for the continent’s recovery.
Christine Lagarde will discuss the book along with Wolfgang Schäuble, Finance Minister of Germany, and Luis de Guindos, Minister of Economy and Competitiveness of Spain. The event will be chaired by Fabian Zuleeg, Chief Executive of the European Policy Centre.
Watch the live webstream on this page from 8.00-9.30 a.m. (Central European Time).
Filed under: Financial Crisis, Advanced Economies, International Monetary Fund, growth, Economic research, Europe, Employment | Tagged: economic recovery, Europe, unemployment, Spain, Christine Lagarde, Germany, book launch | Leave a comment »
Posted on January 23, 2014 by iMFdirect
By José Viñals
Brisbane and Basel may be 10,000 miles apart, but when it comes to financial regulation the two cities will be standing cheek by jowl.
At the next summit of the Group of Twenty advanced and emerging economies, to be held in Brisbane in November, political leaders will take the pulse of the global financial regulatory reform agenda, launched five years ago. The explicit goal of the Australian G-20 presidency is to finally complete these essential reforms. As Prime Minister Tony Abbott said today in Davos, “Financial regulation is always a work-in-progress, but these reforms now need to be finalized in ways that promote confidence without eliminating risk.”
I strongly support this extra push to create a safer financial system that can better support the needs of the real economy, and better protect taxpayers. For far too long, critics have been able to portray the G-20 reform agenda as a regulatory supertanker stuck in the shallow waters of technical complexity, financial industry pushback, and diverging national views. This image is increasingly off the mark.
Filed under: Economic Crisis, Economic outlook, Employment, Europe, Financial Crisis, Fiscal policy, G-20, growth, IMF, International Monetary Fund, Politics | Tagged: Basel III, Ben Bernanke, Davos, economic reform, European Union, Financial Stability Board, G-20, global financial system, Japan, José Viñals, U.S. Fed, United Kingdom, United States, United States Federal Reserve | 3 Comments »
Posted on January 22, 2014 by iMFdirect
By Min Zhu
(Version in Français, Русский, 日本語, Português, عربي and 中文)
We had a big debate on emerging markets’ growth prospects at our Annual Meetings in October 2013. We lowered our 2013 growth forecast for emerging markets and developing economies by a whopping 0.5 percentage points compared to our earlier forecast. Some argued that we were too pessimistic. Others said that we should have stuck with the lower-growth scenario we had devised at the onset of the global financial crisis.
Fast forward to today. Indeed, most recent figures indicate that the engines of global growth—emerging markets and developing economies—have slowed significantly. Their growth rate dropped about 3 percentage points in 2013 from 2010 levels, with more than two thirds of countries seeing a decline— Brazil, China, and India lead the pack. This is important for the global economy, since these economies generate half of today’s global economic activity.
In my more recent travels around the world—five regions on three continents—I received the same questions everywhere: what is happening with the emerging markets? Is the slowdown permanent? Can emerging markets boost their growth? What are the downside risks?
Filed under: Annual Meetings, Asia, Economic Crisis, Economic outlook, Economic research, Emerging Markets, Financial Crisis, Fiscal policy, Fiscal Stimulus, growth, IMF, International Monetary Fund, Latin America | Tagged: Brazil, central banks, China, commodiity prices, India, Indonesia, interest rates, international trade, Turkey | 1 Comment »
Posted on January 21, 2014 by iMFdirect
By: Olivier Blanchard
(Versions in Español عربي, Русский, Français, and 中文 )
I want to take a moment today to remember our colleague Wabel Abdallah, who was our resident representative in Afghanistan and who, as many of you know, was killed in the terrorist attack in Kabul on Friday. We are mourning a colleague, a friend to many of us, above all a dedicated civil servant who represented the best the Fund has to offer, and gave his life in the line of duty, helping the Afghan people. Our hearts go out to his family and to the many victims of this brutal attack.
Let me now turn to our update of the World Economic Outlook and distill its three main messages:
First, the recovery is strengthening. We forecast world growth to increase from 3% in 2013 to 3.7% in 2014. We forecast growth in advanced economies to increase from 1.3% in 2013 to 2.2% in 2014. And we forecast growth in emerging market and developing economies to increase from 4.7% in 2013 to 5.1% in 2014.
Filed under: Advanced Economies, Asia, Economic Crisis, Economic outlook, Economic research, Emerging Markets, Financial Crisis, growth | Tagged: China, Europe, fiscal consolidation, forecast, France, Germany, global outlook, Japan, monetary policy, Olivier Blanchard, Southern Europe, unemployment, United Kingdom, United States, WEO, World Economic Outlook | Leave a comment »
Posted on January 16, 2014 by iMFdirect
By Alejandro Werner
(Version in Español and Português)
Some basic realities seem to be getting lost in the debate over the Fed’s “exit” from unconventional monetary policy and its impact on Latin America.
First, the still-loose stance makes sense. U.S. inflation is too low, the output gap too large, and the labor market too weak. And even during tapering, the Fed’s stance will remain highly loose. The 10-year Treasury rate, adjusted for core inflation, is about 230 basis points below its 30-year average and the inflation-adjusted Fed funds rate is 320 basis points below. These rates are likely to remain below their 30-year average for at least the next two to three years.
Filed under: Advanced Economies, Economic Crisis, Economic outlook, Emerging Markets, Español, Financial Crisis, Fiscal policy, growth, IMF, International Monetary Fund, Latin America, Low-income countries | Tagged: capital flows, financial stability, inflation, Latin America, monetary policy, U.S., U.S. Fed | Leave a comment »