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iMFdirect
iMFdirect features views by IMF economists and officials about pressing issues in the global economy. The views expressed are those of the author(s) and do not necessarily represent the views of the IMF and its Executive Board.

iMFdirect

Bringing Down High Debt

By Vitor Gaspar and Laura Jaramillo April 18, 2018 Versions in 中文 (Chinese),  Español (Spanish), 日本語 (Japanese),  Português (Portuguese) High debt makes governments’ financing vulnerable to sudden changes in market sentiment (photo: NYSE-LUCAS JACKSON-REUTERS Newscom). Global debt hit a new record high of $164 trillion in 2016, the equivalent of 225 percent of global GDP. Both private and public debt have surged over the past decade. High debt makes government’s financing vulnerable...

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A Bumpy Road Ahead for the Global Financial System

By Tobias Adrian April 18, 2018 Version in Español (Spanish) An unexpected increase in inflation could prompt the Federal Reserve and other central banks to raise interest rates faster than currently anticipated, roiling financial markets (photo: Tom Williams/CQ Roll Call/Newscom). The current economic environment remains favorable, but short-term risks to global financial stability have increased in the past six months, as a result of a spike in stock-market volatility in February...

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Global Economy: Good News for Now but Trade Tensions a Threat

By Maurice Obstfeld April 17, 2018 Versions in عربي (Arabic), 中文 (Chinese), Español (Spanish), Français (French), 日本語 (Japanese), Português (Portuguese), Русский (Russian) Container ship in Colombo, Sri Lanka: the recent escalating tensions over trade present a growing risk to the global economy (photo: STRINGER/REUTERS/Newscom). The world economy continues to show broad-based momentum. Against that positive backdrop, the prospect of a similarly broad-based conflict over trade...

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An Even-handed Approach to Crypto-Assets

By Christine Lagarde April 16, 2018 Versions in  عربي (Arabic) Healthcare companies are studying how to use the technology behind crypto assets to maintain confidential medical data (BSIphotos/Newscom). The dizzying gyrations of crypto-assets such as Bitcoin invite comparisons with the tulip mania that swept Holland in the 17th century and the recent dot-com bubble. With more than 1,600 crypto-assets in circulation, it seems inevitable that many will not survive the process of...

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Fiscal Rules: Make them Easy to Love and Hard to Cheat

By Xavier Debrun, Luc Eyraud, Andrew Hodge, Victor Lledo, Catherine Pattillo, Abdelhak Senhadji April 13, 2018 Versions in Português  (Portuguese) The national debt clock in New York City: a fiscal rule, like the debt ceiling, should not be set too low or too high. (photo: Frances M. Roberts/Newscom) Rules to contain lavish government deficits are most effective if countries design them to be simple, flexible, and enforceable in the face of changing economic circumstances. In new...

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The Digital Gamble: New Technology Transforms Fiscal Policy

By Vitor Gaspar and Geneviève Verdier April 12, 2018 Versions in عربي (Arabic),  Español (Spanish),  日本語 (Japanese), Português  (Portuguese), Русский (Russian) Traffic in Singapore: the city uses digital technology for road pricing to manage road congestion congestion (photo: Kua Chee Siong/ SPH/Newscom).. In Rwanda, digitally-monitored drones deliver blood supplies to hospitals. In Estonia, it takes five minutes to file taxes and 99 percent of government services are available...

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Risky Business: Reading Credit Flows for Crisis Signals

By Claudio Raddatz Kiefer and Jérôme Vandenbussche  April 10, 2018 The odds of a severe economic downturn are higher when a growing portion of credit flows to riskier firms, according to a new IMF study (Photo: Pali 137/ iStock by Getty Images). Supervisors who monitor the health of the financial system know that a rapid buildup of debt during an economic boom can spell trouble down the road. That is why they keep a close eye on the overall volume of credit in the economy. When...

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For Home Prices in London, Check the Tokyo Listings

By Claudio Raddatz Kiefer and Jane Dokko April, 10, 2018 Versions in عربي (Arabic) Hong Kong viewed from Victoria Peak. House prices across countries and cities are increasingly moving in tandem (Photo: Fraser Hall/Robert Harding/Newscom). If house prices are rising in Tokyo, are they also going up in London? Increasingly, the answer is yes. In recent decades, house prices around the world have shown a growing tendency to move in the same direction at the same time. What accounts...

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Wanted: Policies to Encourage and Enable Work in Advanced Economies

By Francesco Grigoli, Zsóka Kóczán, and Petia Topalova April 9, 2018  Versions in عربي (Arabic), Español (Spanish), Français (French), 日本語 (Japanese) Aging may slow economic growth in advanced economies (photo: Zero Creatives Cultura/Newscom). Population growth in advanced economies is slowing, life expectancy is rising, and the number of elderly people is soaring. Because older workers participate less in the labor market, the aging of the population could slow growth and, in many...

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The Decline in Manufacturing Jobs: Not Necessarily a Cause for Concern

By Bertrand Gruss and Natalija Novta April 9, 2018 Version in عربي (Arabic), 中文 (Chinese),  Español (Spanish), 日本語 (Japanese), Português  (Portuguese), Русский (Russian) Textile manufacturing plant in Recife, Brazil: in many countries, the share of manufacturing jobs is declining (photo: Ingram Publishing/Newscom). Manufacturing jobs are waning. In many emerging market and developing economies, workers are shifting from agriculture to services, bypassing the manufacturing sector. In...

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