Posted on August 4, 2016 by iMFdirect
By John C. Bluedorn and Christian Ebeke
Small businesses could be the lifeblood of Europe’s economy, but their size and high debt are two of the factors holding back the investment recovery in the euro area. The solution partly lies in policies to help firms grow and reduce debt.
Our new study, part of the IMF’s annual economic health check of the euro area, takes a novel bottom-up look at the problem. We analyze the drivers of investment using a large dataset of over six million observations in eight euro area countries, from 2003 to 2013: Austria, Belgium, Germany, France, Finland, Italy, Portugal, and Spain. Continue reading
Filed under: banking, Economic research, euro zone, Europe, Finance, Financial Crisis, IMF, International Monetary Fund, Investment, Public debt | Tagged: Austria, bank financing, banking, Belgium, credit risk, euro area, Europe, Finland, France, Germany, IMF, International Monetary Fund, investment, Italy, leverage, nonperforming loans, Portugal, public debt, small and medium-sized enterprises, Spain | Leave a comment »
Posted on February 17, 2016 by iMFdirect
By Andrea F. Presbitero and Min Zhu
(Versions in 中文 (Chinese), Français, and Português)
Many low-income developing countries have joined the group of Eurobond issuers across the globe— in sub-Saharan Africa (for example, Senegal, Zambia, and Ghana), Asia (for example, Mongolia) and elsewhere, raising over US$21 billion cumulatively over the past decade. Tapping these markets provides a new source of funds, but also exposes borrowers to shifts in investor sentiment and rising global interest rates.
Filed under: Africa, Asia, Emerging Markets, IMF, International Monetary Fund, Low-income countries, Public debt | Tagged: Asia, bond spreads, capital inflows, emerging markets, eurobond, exchange rates, financial markets, foreign reserves, GDP, IMF, iMFdirect, International Monetary Fund, low-income countries, public debt, public investment, Sub-Saharan Africa | Leave a comment »
Posted on November 2, 2015 by iMFdirect
By Maurice Obstfeld
How quickly should the United States tighten monetary policy and exit from quantitative easing? Is the neutral real interest rate lower than before the crisis? Should we raise inflation targets? What can we learn from the unconventional policies that emerging markets adopted during the crisis? Are we entering an environment of global deflation? And if so, can the existing central bank toolkit stave off that threat?
Seven years after the crisis, the effects of unconventional monetary policies continue to be a matter of debate. There is little consensus not only about the effectiveness of these policies in promoting aggregate demand, but also about possible unintended side effects on financial stability.
Filed under: Advanced Economies, Economic Crisis, Economic outlook, Economic research, Financial Crisis, IMF, International Monetary Fund, Multilateral Cooperation, Public debt, Reform | Tagged: Ben Bernanke, exchange rate, Federal Reserve, IMF Jacques Polak Research Conference, Jacques Polak, Maurice Obstfeld, Paul Krugman, spillovers, unconventional monetary policy, United States | Leave a comment »
Posted on October 7, 2015 by iMFdirect
by Vitor Gaspar
(Versions: عربي, 中文, Français, Русский, and Español)
The world economy is experiencing important transitions and associated uncertainties.
- Commodity prices have fallen sharply, with adverse consequences for exporting countries.
- China’s rebalancing and the prospect of U.S. interest rate increases are having important and costly spillover effects on other economies.
- And these and other factors are posing important fiscal challenges, especially for emerging markets.
Filed under: Advanced Economies, Annual Meetings, Asia, Economic Crisis, Economic outlook, Economic research, Emerging Markets, Financial Crisis, Fiscal policy, growth, IMF, International Monetary Fund, Latin America, Public debt | Tagged: buffers, Chile, China, commodiity prices, emerging market, Fiscal Monitor, interest rates, Norway, Saudi Arabia, spillovers, U.S. interest rates, Venezuela | Leave a comment »
Posted on October 7, 2015 by iMFdirect
By José Viñals
(Versions in 中文, Français, Русский, and Español)
Today global financial stability is not yet assured and downside risks prevail. Our recommendation is for an urgent upgrade in policies, to avoid downside risks and to achieve our upside scenario of “successful normalization” of monetary and financial conditions. This will secure financial stability and strengthen the economic recovery.
Filed under: Advanced Economies, Asia, Economic Crisis, Economic outlook, Economic research, Emerging Markets, Financial Crisis, Fiscal policy, growth, IMF, International Monetary Fund, Public debt | Tagged: China, emerging economies, euro area, European Central Bank, financial stability, GFSR, Japan, José Viñals, U.S. Federal Reserve, United States | Leave a comment »
Posted on August 19, 2015 by iMFdirect
By John Bluedorn, Anna Ilyina and Plamen Iossifov
All European Union members, except Denmark and the United Kingdom, are expected under EU treaties to eventually adopt the euro. Six Central and Eastern EU members – Bulgaria, Croatia, Czech Republic, Hungary, Poland and Romania – are yet to do so.
In the meantime, these countries have a decision to make: Should they opt in to the Banking Union before adopting the euro? Such a move may offer greater insurance against shocks, but at a certain cost to policy flexibility. In a recent study, we explore some of the trade-offs that countries need to weigh.
Filed under: Advanced Economies, Economic Crisis, Economic research, Europe, Financial Crisis, Fiscal policy, IMF, International Monetary Fund, Public debt | Tagged: banking union, euro | Leave a comment »
Posted on August 12, 2015 by iMFdirect
By Francesco Grigoli, Alexander Herman, Andrew Swiston, and Gabriel Di Bella
(Version in Español and Português)
In the wake of the global financial crisis, monetary and fiscal policies were used aggressively to counteract the effects of the crisis on economic activity. Policymakers look at a number of indicators to guide them in assessing an economy’s level of activity relative to its productive capacity. But trying to figure out the position of the economy in real time is often quite challenging, with consequences for setting policy.
In the case of Brazil in 2011, for example, policymakers estimated in real time that the economy was at a level of output consistent with its productive capacity. Over time, however, the assessment of the cyclical position of the Brazilian economy changed drastically. It had not just been at full capacity, but was overheating. The economy was actually facing inflationary pressures, requiring policy tightening to bring it back to the central bank’s target.
Filed under: Economic Crisis, Economic outlook, Economic research, Emerging Markets, Español, Finance, Fiscal policy, growth, IMF, International Monetary Fund, Investment, Latin America, Public debt | Tagged: Brazil, central bank, Chile, Colombia, fiscal policies, inflation, Latin America, macroeconomics, Mexico, monetary policy, Peru | Leave a comment »