(AGENPARL) – ven 24 febbraio 2023 The latest IMF analysis of global economics, finance, development and policy issues shaping the world. []
[Hero weekend read]
Dear Colleague,
In today’s edition, we highlight:
– Managing Director in Ukraine
– Global economy at turning point
– Gold, silver and stability
– Crypto’s promise
– Democracy and growth
The Weekend Read will take a break next week but return on Friday, March 10.
UKRAINE
(Credit: @KGeorgieva/Twitter)
Kristalina Georgieva praised President Volodymyr Zelenskyy and his officials for their steadfast leadership and management of the economy during a visit to Ukraine’s capital, Kyiv.
Georgieva, who also met leaders from civil society, parliament and the private sector, said she saw an economy that continues to function despite the challenges.
“Shops are open, services are being delivered and people are going to work. This is remarkable testament to the spirit of the Ukrainian people.”
The managing director reiterated the IMF’s unwavering commitment to continue supporting Ukraine.
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GLOBAL OUTLOOK
(Credit: Prisma/Adobe Stock)
Kristalina Georgieva said that this year could be a turning point for the global economy, but growth is still low, price pressures persist and too many economies are still hurting badly after three years of shocks.
About 45 percent of low-income countries are at high risk of debt distress and about 25 percent of emerging economies face default-like borrowing spreads, she added.
The managing director appealed for a united front to support vulnerable people and economies.
“We need to find common ground even as geopolitical tensions are rising. And we need to steer clear of zero-sum policies that would only leave the world poorer and less secure.”
GLOBAL OUTLOOK
Signs of resilience
ASIA PACIFIC OUTLOOK
(Credit: Michael Discenza/Unsplash)
But even though the short-term outlook has brightened, important longer-term challenges remain, including slower growth in China from 2024 onwards, which will weigh on growth prospects across Asia’s highly integrated supply chains and around the world.
As Srinivasan says, “This will make reforms to boost productivity and long-term growth more urgent across Asia.”
FINANCE & DEVELOPMENT
(Credit: Bjorn Wylezich/Adobe Stock)
Bimetallism operated smoothly as long as the financial environment was stable and only one country needed to sustain it. When the going got tougher, maintaining bimetallism would have been beneficial, but the required international cooperation failed, he writes.
“While today’s monetary system operates very differently from that of the 19th century, monetary stability remains a global public good, which requires international cooperation.”
Coming Soon: F&D’s March Edition
(Credit: March Cover Pete Reynolds)
With inflation resulting from the COVID-19 pandemic and Russia’s invasion of Ukraine forcing a re-think of how central banks conduct monetary policy, the March edition of F&D Magazine focuses on New Directions for Monetary Policy. Authors include Gita Gopinath, Raghuram Rajan, Markus K. Brunnermeier, Masaaki Shirakawa, Christoffer Koch, Greg Kaplan, Giancarlo Corsetti, Michael Weber, Claudio Borio, and many more.
Alan Blinder, former Fed vice chair and one of the world’s most influential economists, says cooperation between monetary and fiscal policy is crucial, but it’s not always the case.
CRYPTO ASSETS
(Credit: Xijian/iStock by Getty Images)
Crypto assets have been more of a disappointment than a revolution for many users, and global bodies including the IMF and the Financial Stability Board urge tighter regulation.
“Crypto was fueled by an attempt to circumvent intermediaries and public oversight,” Adrian says.
“Ironically, its real value may come from the technology that the public sector can leverage to upgrade payments and financial infrastructure for the public good”.
Persistent growth in wages and prices may feed off one other, leading to a wage-price spiral in which inflation rises ever higher. However, as the Chart of the Week shows, only a few episodes with dynamics similar to those seen in advanced economies after the pandemic were followed by wage-price spirals. In most cases, nominal wages caught up while inflation ticked down over several quarters, allowing inflation-adjusted wages to gradually recover. A sustained acceleration of wages and prices was rare.
Weekly Roundup
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Thank you again very much for your interest in the Weekend Read! Be sure to let us know what issues and trends we should have on our radar.
[nick]
Nick Owen
Editor
IMF Weekend Read