(AGENPARL) – ven 17 marzo 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:
– Monetary policy lessons from past crises
– Financial systems and climate risks
– Retreating house prices
– Inequality and credit card rewards
MONETARY POLICY
(Credit: Adobe Stock / IMF)
We might begin, she writes, with the lessons from the pandemic and war that are relevant for monetary policy, even if the world eventually moves back to an environment of low interest rates and low inflation. Most economists missed the inflation surge, and we need to understand why, and how monetary policy may have to change going forward.
“But some crisis effects—high inflation, supply chain disruptions, greater trade barriers—may persist much longer, or intensify. That could challenge macroeconomic stability around the world, especially in emerging markets. How can we avoid this?”
The more palpable risk of rapid inflation means it’s crucial to revisit the robustness of strategies such as running the economy hot and seeing supply shocks as temporary, Gopinath writes. “These strategies offer benefits, but also raise risks to price stability.”
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FINANCE & DEVELOPMENT
The March edition of F&D Magazine focuses on New Directions for Monetary Policy. Authors include Gita Gopinath, Raghuram Rajan, Markus Brunnermeier, Masaaki Shirakawa, Christoffer Koch, Greg Kaplan, Giancarlo Corsetti, Michael Weber, Claudio Borio, and many more.
While the currency values of today’s economic powerhouses help maintain global financial stability, the currency systems in the 19th century were tied to precious metals and France played the stabilizing role. In the early 1800s, most countries tied their currencies to silver or gold, but Napoleon tied the French franc to both, which sparked the era of global bimetallism. In this podcast, IMF economist Johannes says this almost-forgotten episode shows that international cooperation is essential for a stable global monetary system.
CAPACITY DEVELOPMENT
(Credit: Peter Gallagher/Unsplash)
“As climate change increasingly influences financial risks and shapes institutional and sector-wide vulnerabilities, enhancement of the risk assessment and prudential frameworks is a critical component of policy responses,” Adrian told a conference on capacity development in the financial sector organized by the IMF and Bank for International Settlements.
Adrian added that webinars, virtual workshops, and online training would remain an important part of the Fund’s capacity development toolkit even as people are once again able to meet in person.
Global housing markets are retreating after years of steady gains. The Chart of the Week shows widespread declines in inflation-adjusted housing prices for two-thirds of the countries with recent data from the Organisation for Economic Co-operation and Development. The moves underscore how housing markets are adjusting to rising interest rates as central banks try to contain inflation. How long the decline in prices continues will depend on whether the rate hikes by central banks have already curtailed inflationary pressures.
Weekly Roundup
SILICON VALLEY BANK
UKRAINE
ARGENTINA
AFRICA
STAFF PAPER
STAFF PAPER
BACK TO BASICS
What is a central bank?
What exactly do central banks do? Our latest Back to Basics video explains their key responsibilities and why they’re so important to our everyday life.
[Mark your calendar]
MARK YOUR CALENDAR
MARCH 21, 8 AM EST
IMF Managing Director Kristalina Georgieva will discuss social safety nets with European Commissioner for International Partnerships Jutta Urpilainen, Sierra Leone’s Minister of Finance Sheku Ahmed Fantamadi Bangura, and Zambia’s Minister of Finance Situmbeko Musokotwane at the start of the African Fiscal Forum.
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