Enhancing Monetary Policy Flexibility Through `De-dollarization’

Posted on September 21, 2016 by iMFdirect

By Marcello Estevão and Greetje Everaert

Version in Español (Spanish)

Borrowing and saving in foreign currencies—so-called dollarization—seem like a rational response by citizens in some emerging market economies to financial crises and runaway inflation. But dollarization usually persists many years after the problems that triggered it are alleviated and limits the effect that central banks can have on economic activity and inflation. Continue reading →

Filed under: International Monetary Fund, South America, trade | Tagged: , , , , | Leave a comment »

Oil Exporters Learn to Live with Cheaper Oil

Posted on June 8, 2016 by iMFdirect

By Martin Sommer, Juan Treviño, and Neil Hickey

Version in  عربي (Arabic)

The significant and prolonged drop in oil prices since mid-2014 has changed the fortunes of many energy-exporting nations around the world. This applies particularly to countries of the Middle East and Central Asia, because these regions are home to 11 of the world’s top 20 energy exporters.

Continue reading →

Filed under: Central Asia, growth, IMF, International Monetary Fund, Middle East, oil, trade | Tagged: , , , , , , , , , , , , , | Leave a comment »

What Future for Unconventional Monetary Policies

Posted on November 2, 2015 by iMFdirect

Maurice Obstfeld2By 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.

Continue reading →

Filed under: Advanced Economies, Economic Crisis, Economic outlook, Economic research, Financial Crisis, IMF, International Monetary Fund, Multilateral Cooperation, Public debt, Reform | Tagged: , , , , , , , , , | Leave a comment »

The Quest for Robust and Synchronized Growth

Posted on October 6, 2015 by iMFdirect

Maurice Obstfeld2By Maurice Obstfeld

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

Today, we released the October 2015 World Economic Outlook.

Our forecasts come at a moment when the world economy is at the intersection of at least three powerful forces.

First, China’s economic transformation – away from export- and investment-led growth and manufacturing, in favor of a greater focus on consumption and services. This process, however necessary and healthy in the longer term, has near-term implications for China’s growth and its relations with its trade partners.

Continue reading →

Filed under: Advanced Economies, Annual Meetings, Asia, Economic Crisis, Economic outlook, Economic research, Emerging Markets, Europe, growth, IMF, International Monetary Fund, Investment, Latin America, Reform | Tagged: , , , , , , , , , , , , , , , , , , , | Leave a comment »

Emerging Market Corporate Debt in Foreign Currencies

Posted on October 1, 2015 by iMFdirect

By Selim Elekdag and Gaston Gelos

Debt held by firms in emerging market economies in a currency other than their own poses extra complications these days. When the U.S. Fed does eventually raise interest rates, the accompanying further strengthening of the U.S. dollar will mean an emerging market’s own currency will depreciate against the higher value of the U.S. dollar, and would make it increasingly difficult for firms to service their foreign currency-denominated debts if they have not been properly hedged.

In the latest Global Financial Stability Report, we find that firms in emerging markets that have increased their debt-to-assets ratios have generally also increased their overall sensitivity to changes in the exchange rate—commonly called exchange-rate exposure.

Continue reading →

Filed under: Annual Meetings, Economic outlook, Economic research, Emerging Markets, Finance, Fiscal policy, IMF, International Monetary Fund, Investment, Reform | Tagged: , , , , , , , , , , , , , | Leave a comment »

Flash Crashes and Swiss Francs: Market Liquidity Takes a Holiday

Posted on May 20, 2015 by iMFdirect

GFSR

By José Viñals

Financial market liquidity can be fleeting. The ability to trade in assets of any size, at any time and to find a ready buyer is not a given.  As discussed in some detail last fall in this blog, a number of factors, including the evolving structure of financial markets and some regulations appear to have pushed liquidity into a new realm: markets look susceptible to episodes of high price volatility where liquidity suddenly vanishes.

In our April 2015 Global Financial Stability Report we identify a new aspect to the problem:  asset price correlations have risen sharply in the last five years across all major asset classes (see figure). Continue reading →

Filed under: Advanced Economies, Emerging Markets, Europe, Finance, IMF, International Monetary Fund | Tagged: , , , , , , , , , , , , , , , | Leave a comment »

Multi-Track Monetary Policies in Advanced Economies: What This Means for Asia

Posted on April 27, 2015 by iMFdirect

By James Daniel and Rachel van Elkan

Since mid-2014, diversity and divergence—applying to countries’ economic situations, policies and performance—have dominated global economic discussions. Differing economic performance in major advanced countries has led to divergent monetary policies.

Both the Bank of Japan and the European Central Bank have started significant expansions of their balance sheets, while the U.S. Federal Reserve has ended its bond-buying program and is expected to start raising rates. This has had many effects, in particular, contributing to a sharp depreciation of the Yen and the Euro against the U.S. dollar (see chart 1).

Continue reading →

Filed under: Asia, Economic Crisis, Economic outlook, Economic research, Europe, Finance, Financial Crisis, Fiscal policy, growth, IMF, International Monetary Fund, Reform | Tagged: , , , , , , , , , , , , , , , , , , , , | Leave a comment »

Next Page »
%d bloggers like this: