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Geoff Gottlieb, the IMF's Senior Regional Representative for Central, Eastern and South-Eastern Europe, warned of the potential for fiscal policy to fuel inflation and so force monetary policy to remain tighter for longer. "We think Polish fiscal policy can do more to help reduce inflation," he said in an interview. "A new fiscal impetus would likely add to inflationary pressures and could also necessitate additional monetary policy tightening." "Our recommendation is for the (Monetary Policy Council) to resume monetary policy tightening if key indicators - core inflation momentum, wage growth, and the economy - fail to slow as projected," he said, urging the MPC to make clear that talk of cuts was premature. The European Commission projects Poland's average inflation rate at 6% next year, the highest in the European Union, retreating from nearly twice that level expected this year.

ORLANDO, Florida, May 15 (Reuters) - China's yuan faces significant long-term obstacles to becoming a global reserve currency of any great import, but the biggest challenge in the near term is the fact that nobody wants to buy Chinese bonds. Reuters ImageReuters Image"It is very hard to create a reserve currency, without attractive reserve assets. Exante Data's figures show foreign investors bought a net $558 billion of Chinese bonds between 2010 and 2021. But in a pool of $12 trillion global reserves, of which nearly 80% is denominated in dollars and euros, these are very small numbers. Reuters ImageRESERVE STATUSAny currency that has designs on attaining international reserve status must meet several criteria and fulfill several roles.

☆ IMF sees uncertainty over Japan's monetary policy, spillover globally
▼ + stars: | 2023-05-04 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

While most Asian central banks must keep tightening monetary policy, Japan remains an exception with inflation still moderate - though this could change. "There is uncertainty around the direction of monetary policy in Japan, amid a rise in inflation," Srinivasan said. "Changes in Japan's monetary policy that lead to further increases in government bond yields could have global spillovers through Japanese investors, who have large investment positions in debt instruments abroad," Srinivasan said. With inflation exceeding its 2% target, markets are rife with speculation the Bank of Japan (BOJ) could modify its bond yield control policy in coming months. The BOJ kept ultra-low interest rates on Friday but announced a plan to review its past monetary policy moves, laying the groundwork for new governor Kazuo Ueda to phase out his predecessor's massive stimulus programme.

BRASILIA/BUENOS AIRES, May 4 (Reuters) - Argentina is seeking new easing of targets in its $44 billion deal with the International Monetary Fund and faster payouts, and is pushing to get key IMF members the United States and Brazil to support it, government officials said. It has ramped up pressure on Argentina and the IMF to revamp the debt program, the largest extended to any country worldwide. The ministry official said backing from the United States and Brazil was key for the IMF talks, and was "positive" about it given the countries' broader support for Argentina's economy. The U.S. Treasury and White House did not comment on record about potential support for Argentina's talks with the IMF. Argentina would need to reach a technical deal with IMF staff before any agreement went to the board for approval.

An IMF review of the budget presents a fresh hurdle before the lender approves the release of pending bailout funds, which are crucial for Pakistan to resolve an acute balance of payments crisis. Pakistan has struggled to strike a deal with the IMF to release funds critical to stabilise the struggling economy. On Thursday, Finance Minister Mohammad Ishaq Dar reiterated that Pakistan has already taken all the agreed steps to unlock the funding. The $1.1 billion tranche is a part of a $6.5 billion bailout package the IMF approved in 2019, which is due to end in June, prior to the budget. The government has removed caps on the exchange rate, imposed taxes, raised energy tariffs, and scaled back subsidies in an attempt to unlock the IMF funding.

☆ IMF's Georgieva says more vulnerabilities in banking sector may be exposed
▼ + stars: | 2023-05-01 | by ( Reuters Staff | ) www.reuters.com time to read: +2 min

BEVERLY HILLS, California (Reuters) -International Monetary Fund Managing Director Kristalina Georgieva said on Monday she expects more weaknesses to be exposed in the banking sector, only hours after First Republic Bank was rescued by JPMorgan Chase . Kristalina Georgieva, Managing Director, International Monetary Fund, speaks at the 2023 Milken Institute Global Conference in Beverly Hills, California, U.S., May 1, 2023. REUTERS/Mike BlakeSpeaking at the 2023 Milken Institute Global Conference in Beverly Hills, California, Georgieva immediately addressed the biggest topic of the day - the banking crisis that has been unnerving investors for weeks. “Recent events continue to remind us of the challenges posed by the interaction between tighter monetary and financial conditions and the buildup in vulnerabilities in the global financial system,” a spokesperson said. The IMF last month trimmed its 2023 global growth outlook slightly as higher interest rates cooled activity but warned that a severe flare-up of financial system turmoil could slash output to near-recessionary levels.

☆ IMF raises 2023 economic outlook for Asia, sees China and India making up half of global growth
▼ + stars: | 2023-05-01 | by ( Jihye Lee | ) www.cnbc.com time to read: +3 min

This comes as the rest of the world braces for slower growth from tightened monetary policy and Russia's invasion of Ukraine. The two largest emerging market economies of the region are expected to contribute around half of global growth this year. International Monetary FundThe IMF's upgraded outlook would mean the region would contribute around 70% of global growth, it said. "Asia and Pacific will be the most dynamic of the world's major regions in 2023, predominantly driven by the buoyant outlook for China and India," the IMF said in its report. On a country-basis, the organization raised its growth outlook for China, Malaysia, the Philippines, and Laos to 5.2%, 4.5%, 6%, and 4% respectively.

☆ IMF's Kammer: Further ECB tightening is required to defeat inflation
▼ + stars: | 2023-04-28 | 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's Kammer: Further ECB tightening is required to defeat inflationAlfred Kammer, director of the European department at the International Monetary Fund, says core inflation is persistently high and "there's nothing worse than pausing an inflation-fighting effort too early … because if you need to do it a second time, the costs to the economy are so much larger."

☆ Investors should own metals and mining stocks as commodities are the next sector to boom after China's reopening, Goldman Sachs chief equities strategist says
▼ + stars: | 2023-04-26 | by ( Morgan Chittum | ) www.businessinsider.com time to read: +2 min

Goldman Sachs chief US equity strategist broke down the bull case for metal and mining stocks. David Kostin points to US companies that will benefit from demand driven by China's reopening. Goldman Sachs analysts forecast a 30% increased in the S&P GSCI, an index that broadly measures the performance of the commodities sector, within the next year. It's not just Kostin who is anticipating immense growth from China's reopening. The International Monetary Fund forecasts China will become the biggest driver of global economic growth over the next five years.

Low and stable inflation is good for markets and the economy, so central banks had to show their seriousness on inflation, Tannenbaum added. Central banks softened rate rises with communication that was mindful of instability risks, showing reassuring "humility", said Perkins. "The bank resolution framework created after the great financial crisis," said Francesco Papadia, senior fellow at Bruegel and former ECB director general for market operations, "is proving difficult to implement." Reuters Graphics4/ UNITED WE STANDAfter CS's rescue, the Fed and other big central banks supported market liquidity with dollar swap lines. Amundi's Pradhan said the "case by case" central bank responses to individual lenders failing in March exposed the lack of a coordinated bank resolution system.

☆ Calls to move away from the U.S. dollar are growing — but the greenback is still king
▼ + stars: | 2023-04-24 | by ( Penny Chen | ) www.cnbc.com time to read: +5 min

Kacper Pempel | ReutersCalls to move away from relying on the U.S. dollar for trade are growing. The U.S. dollar accounted for 58.36% of global foreign exchange reserves in the fourth quarter last year, according to data from the IMF's Currency Composition of Foreign Exchange Reserves (COFER). China is one of the most active players in this push given its dominant position in global trade right now, and as the world's second largest economy. The IMF estimates that Asia could contribute more than 70% to global growth this year. In the Middle East, major oil exporter Saudi Arabia has reportedly signaled it's open to trade in other currencies other than the greenback.

LONDON, April 21 (Reuters) - Zambia will send its first fully-formed debt restructuring plan to China and other government creditors "very soon" the government's legal advisors said, as it looks to capitalise on fresh momentum seen in high-level talks in recent days. "We are hoping to provide a restructuring proposal to the official creditors (committee) very soon," Melissa Butler at White & Case, the law firm advising Lusaka on the restructuring, told Reuters, adding that meant the "coming weeks". "We want to start talking about concrete proposals about what debt relief would look like." Zambia is hoping for more than $8 billion of debt relief and Hichilema recently warned that if the restructuring was not able to be concluded soon, it would "tarnish" the tough fiscal reform measures the government has been undertaking. Zambia's restructuring has a wider importance too.

☆ Argentina's economy teeters on the edge of deeper crisis as market anxiety grows
▼ + stars: | 2023-04-21 | by ( Gabriel Burin | ) www.reuters.com time to read: +3 min

BUENOS AIRES, April 21 (Reuters) - Argentina's economy will teeter on the edge of a deeper crisis in the run up to October's presidential vote as growing market anxiety adds to a harmful mix of drought-induced recession and skyrocketing inflation, a Reuters poll showed. Pointing to an increasingly negative outlook, the number of recession forecasts escalated to 27 of 32 respondents from just 7 of 23 in January. 3 economy into a crisis comparable to the chaotic periods of 1989-1990 and 2001-2002. For Mexico, growth prospects were slightly upgraded to 1.5% this year and 1.6% in 2024 from 1.0% and 1.8% in January - still well below the government's more optimistic scenario of a 3.0% expansion. Reporting by Gabriel Burin in Buenos Aires; Editing by Alexandra HudsonOur Standards: The Thomson Reuters Trust Principles.

☆ A recession is coming — and stock markets won't come through it unscathed, strategist says
▼ + stars: | 2023-04-21 | by ( Sam Meredith | ) www.cnbc.com time to read: +1 min

The latest U.S. economic data suggests a recession is coming, according to the chief executive of financial advisory firm Longview Economics, and investors may need to prepare for some pain in the stock market. Speaking to CNBC's "Squawk Box Europe" on Friday, Chris Watling said he believed a recession was on its way, citing what he described as "pretty compelling" and "brutally bad" leading economic indicators. The Conference Board on Thursday said its Leading Economic Index for the U.S. fell by 1.2% in March, slipping to its lowest level since November 2020. The data appeared to indicate that economic weakness could soon intensify and spread throughout the U.S. economy. "Every time you've had that in the U.S., you've had a recession.

☆ New BOJ chief's message to world: We're staying the course - for now
▼ + stars: | 2023-04-17 | by ( Leika Kihara | ) www.reuters.com time to read: +5 min

Under YCC, the BOJ guides short-term rates at -0.1% and the 10-year Japan government bond yield around zero with an implicit cap of 0.5%. "We're in an economy where we're going to be hit more by supply shocks, and monetary policy will face more serious trade-offs," she said on Friday. Ranil Salgado, the IMF's Japan mission chief, sees scope for the BOJ to modify the long-term yield target this year, given heightening prospects of durable wage growth. As long as the short-term rates remain zero or slightly negative, the BOJ can keep monetary policy accommodative even if it tweaks the yield target, he said. "We are advising (the BOJ) to pretty much already be thinking about it," Salgado said on the idea of tweaking YCC.

WASHINGTON, April 17 (Reuters) - Just a month after the biggest banking crisis in more than a decade, the world's top economic and financial policymakers gathered in Washington and said surprisingly little about financial system stability - at least publicly. Some officials conveyed a sense that banking system safety was further down the priority list of global economic problems. "But it's still something where we need to stay vigilant and address potential risks which may emerge in our financial system," Dombrovskis told reporters. He added that the European Union's banking system was stable, well capitalized with ample liquidity. But during the IMFC's closed meeting, the possible spillovers from financial stability risks were a main topic, Ukrainian Finance Minister Serhiy Marchenko told Reuters.

☆ Analysis: New BOJ head's message to world: We're staying the course - for now
▼ + stars: | 2023-04-16 | by ( Leika Kihara | ) www.reuters.com time to read: +5 min

☆ IMF sees scope for BOJ to tweak yield target this year
▼ + stars: | 2023-04-15 | by ( Leika Kihara | ) www.reuters.com time to read: +2 min

Salgado said the BOJ must keep monetary policy ultra-loose as sustainable achievement of 2% inflation is not yet in sight. Once the BOJ has confidence that Japan will see inflation and wage growth durably accelerate, it can tweak its long-term interest rate target, he said. Under its yield curve control (YCC) policy, the BOJ guides short-term interest rates at the -0.1% level and the 10-year bond yield around zero with an implicit cap of 0.5%. As long as the short-term rates remain zero or slightly negative, the BOJ can keep monetary policy accommodative even if it tweaks the yield target, Salgado said. "Our personal view is, yes," he said, when asked whether conditions could fall in place for the BOJ to tweak the 10-year yield target this year.

☆ IMF's Georgieva sees 'tangible progress' on debt issues, urges seeking help earlier
▼ + stars: | 2023-04-14 | by ( Andrea Shalal | ) www.reuters.com time to read: +2 min

WASHINGTON, April 14 (Reuters) - International Monetary Fund chief Kristalina Georgieva said on Friday that debtors and creditors made "tangible progress" on debt restructuring issues this week, but urged countries facing mounting debt problems to seek help earlier in the process. A new sovereign debt roundtable was helping to accelerate work on debt restructurings, Georgieva told a news conference during the IMF and World Bank spring meetings in Washington. But countries nearing debt distress and their creditors should move forward on reprofiling debt levels before a full restructuring was needed, she said. Imagine a further tightening of financial conditions, that increases the burden on these countries," she added. Georgieva said the IMF would continue to work closely with the 20 African countries with heavy debt burdens to avoid getting to the point where restructurings were needed.

WASHINGTON, April 14 (Reuters) - The International Monetary Fund's steering committee on Friday said it would accelerate its discussions on quota reforms at the global lender with an eye to making "considerable progress" by its next meeting in October. "In this context, we support at least maintaining" the IMF’s current lending resources, Calvino said in a summary of the committee's work. "With regard to IMF resources, I continue to believe that overall resources remain adequate," Yellen said. "At the same time, the IMF needs to follow through on its commitment to a new quota formula that is both fair and simple and primarily reflects the economic size of its member countries." He called for a "pragmatic approach" to complete the review by December to increase IMF resources and to "strengthen the voice and representation of dynamic emerging market and developing economies."

☆ IMF's Georgieva sees 'tangible progress' on debt issues, urges early reprofiling
▼ + stars: | 2023-04-14 | by ( ) www.reuters.com time to read: +1 min

WASHINGTON, April 14 (Reuters) - International Monetary Fund Managing Director Kristalina Georgieva said on Friday debtors and creditors made "tangible progress" on debt restructuring issues this week, but called for early reprofiling of debts for countries facing problems. A new sovereign debt roundtable was creating a framework to accelerate work on debt restructurings, Georgieva told a news conference during the IMF and World Bank spring meetings in Washington, noting that countries had reached a common understanding of the role that multilateral development banks could play, by providing positive net flows. But she said it was important for countries nearing debt distress and their creditors to move forward on reprofiling debt levels before a full restructuring was needed, especially given the risk of a further tightening of financial conditions. Reporting by Andrea Shalal; Editing by Paul SimaoOur Standards: The Thomson Reuters Trust Principles.

☆ Yellen says IMF has adequate resources, but needs quota reform
▼ + stars: | 2023-04-14 | by ( ) www.reuters.com time to read: 1 min

WASHINGTON, April 14 (Reuters) - U.S. Treasury Secretary Janet Yellen said on Friday that the International Monetary Fund has adequate resources to deal with global financing challenges but needs to follow through with "fair and simple" shareholding reforms that reflect the economic size of its member countries. Yellen also said in a statement to the IMF's steering committee that she wanted the World Bank to implement further reforms to scale up lending for climate and other global needs on a rolling basis ahead of the IMF and World Bank's annual meetings in October in Marrakech, Morocco. Reporting by David Lawder; Editing by Chizu NomiyamaOur Standards: The Thomson Reuters Trust Principles.

☆ IMF says yet to agree date with Egypt for programme review
▼ + stars: | 2023-04-14 | by ( ) www.reuters.com time to read: +2 min

Disbursements under the 46-month programme are subject to eight reviews, the first of which was dated March 15, 2023, in an IMF staff report published in December. "Egypt really needs to show some meaningful measures to rebuild confidence and show that the process has started," said Monica Malik of ADCB. "It's better to start the review once there is tangible signs of process with reforms, including on a flexible currency." In its December accord with the IMF, Egypt also promised to sell state assets worth billions of dollars over the next four years. "Egypt has done important reforms over the last few years, and the fund has been very supportive..," Azouri said.

The external financing is needed to fully fund the balance of payments gap for the fiscal year that ends in June. Last week Saudi Arabia also told the IMF it would provide financing of $2 billion to Pakistan. Dar has said Pakistan has given details of the scheme to the IMF, which has asked how it would it find the resources needed. The IMF program will disburse another tranche of $1.4 billion to Pakistan before it concludes in June. Reporting by Gibran Naiyyar Peshimam, writing by by Shilpa Jamkhandikar; editing by Sudipto GangulyOur Standards: The Thomson Reuters Trust Principles.

☆ China takes swipe at Western 'friend-shoring' efforts
▼ + stars: | 2023-04-14 | by ( Leika Kihara | ) www.reuters.com time to read: +2 min

WASHINGTON, April 14 (Reuters) - China's central bank governor on Friday took a swipe at efforts by Western economies to trade more with allies and rely less on the world's largest goods-exporting country, saying such "friend-shoring" attempts could prevent global supply chain tension from easing. Reducing their deep dependence on supply chains with China at their center has become a top priority among Western economies as Beijing's threats to Taiwan heighten geopolitical risks in Asia. "Despite an overall easing of supply chain tensions, they continue to be challenged by protectionist measures such as onshoring, nearshoring, and friend-shoring," Yi said. U.S. Treasury Secretary Janet Yellen has recently encouraged "friend-shoring," or the diversification of supply chains away from China to market-oriented democracies such as India. The fragmentation of global trade has drawn warnings from international institutions including the IMF.

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