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☆ IMF warns deeper financial turmoil would slam global growth
▼ + stars: | 2023-04-11 | by ( David Lawder | ) www.reuters.com time to read: +5 min

The IMF's U.S. outlook improved slightly, with growth in 2023 forecast at 1.6% versus 1.4% forecast in January as labor markets remain strong. "Our advice is for monetary policy to remain focused on bringing down inflation," IMF chief economist Pierre-Olivier Gourinchas told reporters. The report included two analyses showing financial turmoil causing moderate and severe impacts on global growth. This "moderate tightening" of financial conditions could slice 0.3 percentage point off of global growth for 2023, cutting it to 2.5%. This scenario could slash 2023 growth by as much as 1.8 percentage points, reducing it to 1.0% - a level that implies near-zero GDP growth per capita.

☆ IMF chief economist: stability risks should not deter central bank inflation fight
▼ + stars: | 2023-04-11 | by ( ) www.reuters.com time to read: +4 min

WASHINGTON, April 11 (Reuters) - Central banks should not halt their fight against inflation because of financial stability risks, which look "very much contained," International Monetary Fund chief economist Pierre-Olivier Gourinchas told Reuters. Gourinchas said most large central banks, including the Federal Reserve, the European Central Bank and the Bank of England, are already near the peak of their rate hike cycles. SEPARATE TRACKSInstead, authorities should contain stability risks with tools used after the failures of Silicon Valley Bank and Signature Bank, such as central bank lending facilities and other backstops, which would free up monetary policy to stay focused on bringing inflation down. "And in my sense, if they're expecting that because they think the Fed or central banks should take into consideration financial stability arguments...we're not there," Gourinchas said. This could lead to an adjustment of yields on longer-term securities upwards as market expectations become more "realigned with what the central banks are communicating."

☆ IMF chief economist: Severe downside growth risk from bank lending tightening
▼ + stars: | 2023-04-11 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailIMF chief economist: Severe downside growth risk from bank lending tighteningPierre-Olivier Gourinchas, chief economist at the International Monetary Fund, speaks to CNBC's Joumanna Bercetche on inflation, the global growth forecast and why he doesn't see risks from a wage price spiral.

☆ Banks in 'more precarious situation' creating risks for global growth, IMF chief economist warns
▼ + stars: | 2023-04-11 | by ( Jenni Reid | ) www.cnbc.com time to read: +1 min

Interest rate rises have increased banks' vulnerabilities — and their response presents a significant risk to global growth, the International Monetary Fund's chief economist warned Tuesday. "Banks are in a more precarious situation. They have healthy cushions, but it's certainly going to lead them to be a little bit more prudent and maybe cut down lending somewhat," Gourinchas said. In one scenario, the IMF sees funding conditions for banks tightening further and squeezing lending, bringing its forecast of 2.8% global growth in 2023 down to 2.5%. Gourinchas said its models had also forecast a more adverse scenario where financial stability is not contained.

☆ Britain hit by biggest day of strikes in a decade as pay disputes escalate
▼ + stars: | 2023-02-01 | by ( Hanna Ziady | ) edition.cnn.com time to read: +5 min

The bill would require basic service levels to be maintained in the fire, ambulance and rail sectors in the event of walkouts. Strikes will affect around 23,400 schools, about 85%, in England and Wales, with many closed fully or partially. According to the union, pay for experienced teachers has declined by 23% since 2010 once inflation is taken into account. In a sign that industrial unrest could escalate further, UK firefighters have voted to strike for the first time since 2003. The Fire Brigades Union has given the government until February 9 to make an improved pay offer.

☆ Emerging markets growth slowdown bottomed out in 2022, but risks remain -IMF
▼ + stars: | 2023-01-31 | by ( Rodrigo Campos | ) www.reuters.com time to read: +4 min

NEW YORK, Jan 30 (Reuters) - The International Monetary Fund on Monday raised its output growth estimate on emerging markets for this year, with projections now showing the economic slowdown in the region may have bottomed out in 2022, on the back of China reopening, a resilient India and unexpected growth in Russia. Inflation, a recent hamper on growth, is seen high although continuing to slow this year and next. Russia, on the other hand, has seen a 2.6 percentage point increase in the 2023 growth projection, which translates to a view of a 0.3% expansion this year. Brazil and Mexico, Latin America's largest economies, were both upwardly revised in their 2023 economic growth by 0.2 and 0.5 percentage point, respectively. For Latam and the Caribbean, the overall increase in the growth estimate was just 0.1 percentage point, to 1.8%.

☆ IMF slashes UK growth outlook, adding pressure on finance minister Hunt
▼ + stars: | 2023-01-31 | by ( ) www.reuters.com time to read: +3 min

REUTERS/Henry NichollsLONDON, Jan 31 (Reuters) - Britain is the only Group of Seven nation to have suffered a cut to its 2023 economic growth outlook in International Monetary Fund forecasts published on Tuesday, adding to pressure on finance minister Jeremy Hunt to come up with a growth plan. Britain's flagging economy now looks set to shrink by 0.6% this year, a sharp downgrade from previously expected growth of 0.3% in the IMF's last forecast in October. All other G7 economies are predicted to grow this year, mostly at a stronger pace than the IMF forecast three months ago. Responding to the IMF report, Hunt said nearly all advanced economies were facing headwinds, and that past forecasts from a range of bodies including the IMF had proven too gloomy about Britain's prospects. Hunt is due to announce measures that he hopes will speed up growth in a budget statement on March 15.

STRONG DEMANDIn its 2023 GDP forecasts, the IMF said it now expected U.S. GDP growth of 1.4%, up from 1.0% predicted in October and following 2.0% growth in 2022. It said the euro zone had made similar gains, with 2023 growth for the bloc now forecast at 0.7%, versus 0.5% in the October outlook, following 3.5% growth in 2022. The IMF said Europe had adapted to higher energy costs more quickly than expected, and an easing of energy prices had helped the region. Gourinchas said together, the two Asian powerhouse economies will supply over 50% of global growth in 2023. Even with China's reopening, the IMF is predicting that oil prices will fall in both 2023 and 2024 due to lower global growth compared to 2022.

☆ The IMF thinks we may actually skirt a recession. It is also surprisingly upbeat about Russia's economy.
▼ + stars: | 2023-01-31 | by ( Huileng Tan | ) www.businessinsider.com time to read: +3 min

The IMF expects the world economy to grow 2.9% in 2023 — which is better than its October forecast of 2.7%. The IMF also expects Russia's economy to grow 0.3% — a reversal from its contraction of 2.2% in 2022. The IMF expects Russia's economy to expand 0.3% in 2023 and 2.1% in 2024 — a stark reversal from an expected 2.2% contraction in 2022. The IMF had predicted in October that Russia's economy would contract by 3.4% in 2022. The fund told Reuters that Russia's economy was supported by a "fairly high" export revenue in 2022 and robust fiscal stimulus in part from military spending.

☆ Central banks are fighting a war on inflation. They're not done yet
▼ + stars: | 2023-01-31 | by ( Julia Horowitz | ) edition.cnn.com time to read: +6 min

London CNN —One of the main jobs of central banks is to keep prices under control, allowing households and businesses to plan for the future with some certainty on what things will cost. Tolga Akmen/EPA-EFE/ShutterstockPolicymakers face difficult questions about exactly when to pause interest rate hikes. The European Central Bank’s main rate is 2%, while the Bank of England’s is 3.5%. Still, investors are becoming increasingly confident that major central banks will change course soon. “Central banks are relatively close to the end,” Sels said.

☆ Global core inflation could return to pre-Covid levels in 2024, IMF says
▼ + stars: | 2023-01-31 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailGlobal core inflation could return to pre-Covid levels in 2024, IMF saysPierre-Olivier Gourinchas, chief economist at the International Monetary Fund, says "the job is not done yet" and central banks will probably remain in tightening mode in 2023.

☆ IMF downgrades UK growth forecast, predicting only economic decline among G-7 countries
▼ + stars: | 2023-01-31 | by ( Jenni Reid | ) www.cnbc.com time to read: +2 min

LONDON — The International Monetary Fund downgraded its outlook for the U.K. economy even as it turns more optimistic on global growth. Its new 2023 forecast on Monday evening also sees the U.K. as the only "advanced economy" to contract, by 0.6%. This is 0.9 percentage points lower than its previous estimate. The IMF forecasts 1.4% growth in the U.S. in 2023, 0.7% growth in the euro area, 1.8% growth in Japan and 1.5% growth in Canada. Meanwhile, it hiked its outlook for the global economy by 0.2 percentage points from its last report in October, to 2.9%.

☆ IMF: Global economic outlook slightly 'less gloomy' than expected
▼ + stars: | 2023-01-30 | by ( Julia Horowitz | ) edition.cnn.com time to read: +4 min

London CNN —The global economy will weaken this year as rising interest rates and Russia’s war in Ukraine continue to weigh on activity. The International Monetary Fund said Monday that it now expects global growth will slow from 3.4% in 2022 to 2.9% in 2023. The IMF now forecasts growth in China will rebound to 5.2% this year, notably higher than its previous estimate. Global inflation is forecast by the IMF to ease from 8.8% in 2022 to 6.6% in 2023 and 4.3% in 2024. “This time around, the global economic outlook hasn’t worsened,” Gourinchas wrote.

☆ IMF hikes global growth forecast as inflation cools and household spending surprises
▼ + stars: | 2023-01-30 | by ( Silvia Amaro | ) www.cnbc.com time to read: +1 min

The International Monetary Fund on Monday revised upward its global growth projections for the year, but warned that higher interest rates and Russia's invasion of Ukraine would likely still weigh on activity. In its latest economic update, the IMF said the global economy will grow 2.9% this year — which represents a 0.2 percentage point improvement from its previous forecast in October. However, that number would still mean a fall from an expansion of 3.4% in 2022. "Growth will remain weak by historical standards, as the fight against inflation and Russia's war in Ukraine weigh on activity," Pierre-Olivier Gourinchas, director of the research department at the IMF, said in a blog post. The outlook turned more positive on the global economy due to better-than-expected domestic factors in several countries, such as the United States.

☆ Globalization has been breaking down for a while – here's what could end it
▼ + stars: | 2022-12-06 | by ( Tom Chitty | ) www.cnbc.com time to read: +1 min

It raised questions about whether the many benefits of globalization outweigh the geopolitical problems it has helped create. The latest wave of globalization has seen great resistance. Worker exploitation and a rise in inequality have also been at least partly attributed to globalization. "I think there's been a globalization bubble, and we're trying to correct it." Watch the video above to learn more about why economists think globalization is fragmenting – and what lies ahead.

Their joint communique released by the U.S. Treasury late on Wednesday did give Japan something - but it was thin gruel. read more"Recognizing that many currencies have moved significantly this year with increased volatility, we reaffirm our exchange rate commitments as elaborated in May 2017," the G7 wrote. And, for the record, the 2017 phraseology was that excess volatility and disorderly currency moves have negative impacts on their economies and financial stability. read more"We cannot tolerate excessive volatility in the currency market driven by speculative moves," he opined after. The big question is whether this dollar surge is in fact a "short run" aberration or whether it is a more permanent feature of the global landscape.

☆ Morning Bid: Confusion reigns
▼ + stars: | 2022-10-12 | by ( ) www.reuters.com time to read: +4 min

Then BoE chief Andrew Bailey said late Tuesday: "You've got three days left now. You've got to get this done" - even as the Financial Times reported the central bank might extend the support. The tension built with Britain's economy looking set to go into recession as data showed it unexpectedly shrank in August. "The worst is yet to come, and for many people, 2023 will feel like a recession," said IMF chief economist Pierre-Olivier Gourinchas. * G20 finance ministers and central bankers meet at annual IMF/World Bank meeting in Washington* Bank of England Financial Policy Committee publishes summary of latest meeting.

☆ Markets are worried the Fed is going too far
▼ + stars: | 2022-10-12 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +7 min

Wall Street is worried that yet another high reading on the Consumer Price Index will prompt another massive interest rate increase and inflict more pain on markets and the US economy. But this full-steam-ahead approach by the Fed, based on the notion that iron-clad data is protection enough, has given some economists pause. Last week’s nonfarm payroll report roiled markets, but job openings have now fallen by 1.8 million since their March peak. The IMF believes that global inflation will peak late this year, but will “remain elevated for longer than previously expected,” even as central banks work aggressively to bring it under control. ▸ The Consumer Price Index, a closely watched measures of inflation in the US is due to be released on Thursday.

☆ IMF welcomes UK's fast-tracked budget plan, urges government to work with Bank of England
▼ + stars: | 2022-10-12 | by ( Matt Clinch | ) www.cnbc.com time to read: +2 min

The tax cuts came as the Bank of England was looking to start selling bonds into the market, unwinding years of quantitative easing. The International Monetary Fund urged lawmakers and central bank policymakers to work in lockstep with each other to mitigate the effects of the slowing economic environment. Speaking more generally, however, he said it's very important that fiscal policy doesn't go in the opposite direction of monetary policy. So that was directly contradicting the objective of monetary policy," he said. His central message was that fiscal policy is hugely important but that it should be done in a way consistent with what central banks are trying to accomplish.

We think the rebalancing must be done," Bailey said at an event organised by the Institute of International Finance. "My message to the funds involved and all the firms involved managing those funds: You've got three days left now. Bailey was keen to distinguish between the temporary, financial stability nature of the latest intervention and previous quantitative easing stimulus. HEAVY LOSSESInflation-linked gilts, typically held by pension funds and known in the market as linkers, suffered a massive sell-off on Monday as the end to the BoE's programme on Friday approached. Simeon Willis, chief investment officer of pension consultants XPS, said he had seen pension funds selling "across the board" to find liquidity.

☆ IMF chief economist says central banks' inflation fight to last into 2024
▼ + stars: | 2022-10-11 | by ( Reuters Staff | ) www.reuters.com time to read: 1 min

FILE PHOTO: A man looks at a shop at the Ameyoko shopping district in Tokyo, Japan, May 20, 2022. REUTERS/Kim Kyung-Hoon/FilesWASHINGTON (Reuters) - Central banks’ fight against inflation may take another two years to play out, increasing unemployment and lowering living standards for many in the world, the International Monetary Fund’s chief economist said on Tuesday. In an interview with Reuters, IMF economic counselor Pierre-Olivier Gourinchas said that broad “core” inflation pressures beyond energy and food prices will take time to bring down to central bank targets of about 2%. “Our projection is that this will start coming down, but we will not be back to central bank targets in 2023,” Gourinchas said of inflation. “We’ll be closer to that in 2024.”

Cutting its 2023 global growth forecasts further, the IMF said in its World Economic Outlook that countries representing a third of world output could be in recession next year. The global lender maintained its 2022 growth forecast at 3.2%, reflecting stronger-than-expected output in Europe but a weaker performance in the United States, after torrid 6.0% global growth last year as the COVID-19 pandemic eased. China's growth outlooks also were downgraded as it struggles with continued COVID-19 lockdowns and a weakening property sector, where a deeper downturn would slow growth further, the IMF said. The growing economic pressures, coupled with tightening liquidity, stubborn inflation and lingering financial vulnerabilities, are increasing the risks of disorderly asset repricings and financial market contagions, the IMF said in its Global Financial Stability Report. A man walks past the International Monetary Fund (IMF) logo at its headquarters in Washington, U.S., May 10, 2018.

☆ IMF cuts 2023 growth outlook amid colliding global shocks
▼ + stars: | 2022-10-11 | by ( David Lawder | ) www.reuters.com time to read: +4 min

The Fund is keeping its 2022 growth forecast at 3.2%, reflecting stronger-than-expected output in Europe but a weaker performance in the United States, after torrid 6.0% global growth in 2021. The IMF kept its 2023 U.S. growth forecast unchanged at 1.0%. The Fund forecast headline consumer price inflation peaking at 9.5% in the third quarter of 2022, declining to 4.7% by the fourth quarter of 2023. A "plausible combination of shocks" including a 30% spike in oil prices from current levels could darken the outlook considerably, the IMF said, pushing global growth down to 1.0% next year - a level associated with widely falling real incomes. The appropriate policy for most was prioritizing monetary policy for price stability, letting currencies adjust and "conserving valuable foreign exchange reserves for when financial conditions really worsen."

☆ IMF urges UK to align fiscal policy with BoE inflation goals
▼ + stars: | 2022-10-11 | by ( David Milliken | ) www.reuters.com time to read: +2 min

"Fiscal policy should be aligned with monetary policy," Gourinchas said at a news conference in Washington, when asked about Britain's economic situation and the turmoil in its government bond market. "Central banks are trying to tighten monetary policy, and if you have at the same time fiscal authorities that try to stimulate aggregate demand, it's like having a car with two people in the front ... each trying to steer the car in a different direction. "Now what we've seen in the UK market, we've seen market dysfunction, related to some illiquidity in some segments," Gourinchas said. The IMF published new growth forecasts for Britain on Tuesday, although these were finalised before Kwarteng's Sept. 23 statement. The Fund expects British economic growth to slow to 0.3% next year compared with a July forecast of 0.5% growth for 2023.

☆ Next year is going to feel painful, IMF chief economist says
▼ + stars: | 2022-10-11 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailNext year is going to feel painful, IMF chief economist saysNext year is going to feel painful, IMF Chief Economist Pierre-Olivier Gourinchas tells CNBC's Geoff Cutmore.

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