Posted on October 5, 2011 by iMFdirect
By Nicolás Eyzaguirre
(Version in Español)
As the European crisis lingers and advanced economies stall, the next six to eighteen months will be challenging for Latin America. Increased global uncertainties may create headwinds for the region—greater stress in the global economy and markets—tailwinds, if the advanced countries’ problems are tackled and economies spring back to life, or volatile gusts—weak growth and continued uncertainty—like we are seeing now.
But it’s not easy to forecast the future of Latin America in these uncertain times, as we discuss in our just-published Regional Economic Outlook for Western Hemisphere. (Here I focus on Latin America, but our report covers the whole region, including North America, Central America, and the Caribbean.)
Today’s global uncertainties are virtually unprecedented. But then again, much of Latin America is stronger today than in past decades. Continue reading
Filed under: Economic outlook, Economic research, International Monetary Fund, Latin America | Tagged: commodity prices, current account deficits, financial market turbulence, financial risks, financial system, fiscal consolidation, global financial markets, government budgets, iMFdirect, inflation, International Monetary Fund, liquidity, monetary policy, Regional Economic Outlook: Western Hemisphere | 5 Comments »
Posted on September 20, 2011 by iMFdirect
By Olivier Blanchard
(Versions in عربي, Français, Español and Русский)
The global economy has entered a dangerous new phase. The recovery has weakened considerably, and downside risks have increased sharply. Strong policies are urgently needed to improve the outlook and reduce risks.
Growth, which had been strong in 2010, decreased in 2011. We had forecast some slowdown, due mainly to fiscal consolidation. One-time events, such as the tragic earthquake in Japan, offered plausible explanations for a further slowdown. The initial U.S. data also understated the size of the slowdown. Now that the numbers are in, it is clear that more was going on. Continue reading
Filed under: Advanced Economies, Economic outlook, Economic research, Emerging Markets, IMF, International Monetary Fund, Low-income countries | Tagged: bank balance sheets, bank capital, bank lending, current account deficits, current accout surpluses, downside risks, economic forecasts, economic rebalancing, external rebalancing, financial volatility, fiscal consolidation, IMF, iMFdirect, International Monetary Fund, low growth, medium-term fiscal consolidation, Olivier Blanchard, private demand, public debt, public deficits, sovereign bonds, weak balance sheets, World Economic Outlook, world growth | 14 Comments »
Posted on May 18, 2011 by iMFdirect
By Antonio Borges
(Versions in Español, Français, Português, Русский)
With all the anxiety generated by the troubles of Portugal, Greece, and Ireland, it is easy to forget that a different part of Europe was in the spotlight two years ago, facing equally dire predictions of bank runs, fiscal ruin, and devaluation.
Today, many economies in emerging Europe are quietly staging a strong comeback. Most impressive is the turnaround in the three Baltic countries, which suffered record deep recessions in the wake of the 2008/09 financial crisis. Take Lithuania, which grew an eye-catching 14.7 percent in the first quarter of 2011. But many other countries in the region are seeing strong growth as well. Continue reading
Filed under: Economic outlook, Emerging Markets, Europe, IMF, International Monetary Fund | Tagged: asset price bubbles, boom-bust cycle, capital inflows, consumption, credit default swaps, current account deficits, domestic demand, economic growth, economic output, exports, growth potential, investment, Macroeconomic policies, markets, structural policies | 2 Comments »
Posted on May 12, 2011 by iMFdirect
By Antonio Borges
(Versions in Español, Français, Português, Русский)
Banks―and the loans they provided in the run-up to the crisis―are at the heart of Europe’s problems today.
Yet it would be wrong to conclude that the crisis was caused by too much financial integration. In fact, the real problem may have been that there was too little financial integration.
Policies to promote deeper integration of Europe’s banks―including through cross-border merger and acquisitions―should be part of the solution. Continue reading
Filed under: Economic outlook, Europe, IMF, International Monetary Fund | Tagged: banks, capital flows, cross-border mergers and acquisitions, current account deficits, European Union, external debt, financial integration, financial sector, fixed exchange rates, foreign exchange risk, interest rates, market failures, Regional Economic Outlook: Europe, regulatory and supervisory frameworks, sovereign debt, sustainable growth, the euro | 3 Comments »
Posted on April 21, 2011 by iMFdirect
By Leslie Lipschitz and Bas Bakker
For all the talk today about capital flows into emerging economies, the topic has actually been debated for many years within the IMF.
For a decade or more, we have grappled with the idea that very large capital flows into successful emerging market countries were almost inevitable and would prove extremely difficult to manage.
And now, with capital flows becoming larger and more volatile, old policy dilemmas are resurfacing with even greater force.
Filed under: Economic Crisis, Emerging Markets, Europe, Financial Crisis, International Monetary Fund | Tagged: asset price bubbles, capital flows, credit growth, current account deficits, exchange rate, exchange rate flexibility, exchange rate regimes, external vulnerability, fixed exchange rates, foreign currency exposure, foreign exchange risk, interest rates, investment, macroprudential policies, monetary policy, rates of return, risk premiums | 1 Comment »
Posted on October 28, 2010 by iMFdirect
By David Owen
(Version in Русский)
Countries in the Caucasus and Central Asia region—especially those that import, rather than export, oil—were hit hard by the Great Recession of 2008/09. The good news is that, today, the outlook for those countries is broadly positive. But, as often seems to be the case in today’s world, this good news is tempered with a word of caution.
According to our latest Regional Economic Outlook for the Middle East and Central Asia, there are a number of downside risks. And the key challenge for these four countries—Armenia, Georgia, Kyrgyz Republic and Tajikistan—will be to take actions now to address these risks. Continue reading
Filed under: Economic Crisis, Economic outlook, IMF, International Monetary Fund | Tagged: Armenia, current account deficits, domestic saving, economic rebalancing, exchange rate depreciation, exchange rate flexibility, external debt, external vulnerability, Fiscal Stimulus, Georgia, Kyrgyz Republic, monetary stimulus, Regional Economic Outlook: Middle East and Central Asia, Tajikistan | Leave a comment »