Maurice Obstfeld on IMF

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Last quote by Maurice Obstfeld on IMF

Situation in Spain is indeed concerning as it causes a lot of uncertainty, both for the Catalan economy, for the Spanish economy. We can only hope that the parties don't act precipitately, negotiate. There is a lot of potential gains on both sides if they do so.feedback
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Oct 10 2017
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All quotes by Maurice Obstfeld on IMF

This improvement comes primarily from good economic news for Europe and Asia as well as our continuing expectation for higher growth this year in the US.feedback

Historically, inclusive co-operative approaches to interdependence have worked better than denial.feedback

So, the world economy may be gaining momentum, but we cannot be sure that we are out of the woods. How can countries safeguard and nurture the global recovery? We could be at a turning point. But even as things look up, the post?World War II system of international economic relations is under severe strain despite the aggregate benefits it has delivered -- and precisely because growth and the resulting economic adjustments have too often entailed unequal rewards and costs within countries.feedback

The economic upswing that we have expected for some time seems to be materialising. One salient threat is a turn toward protectionism, leading to trade warfare.feedback

Capitulating to those pressures would result in a self-inflicted wound, leading to higher prices for consumers and businesses, lower productivity and, therefore, lower overall real income for households.feedback

At the same time, however, the upgrade to our 2017 forecast is modest, and longer-term potential growth rates remain subdued across the globe compared with past decades, especially in advanced economies. Moreover, while there is a chance growth will exceed expectations in the near term, significant downside risks continue to cloud the medium-term outlook, and indeed may have intensified since our last forecast.feedback

One salient threat is a turn toward protectionism, leading to trade warfare. Mainly in advanced economies, several factors – lower growth since the 2010–11 recovery from the global financial crisis, even slower growth of median incomes, and structural labour-market disruptions – have generated political support for zero-sum policy approaches that could undermine international trading relationships, along with multi-lateral cooperation more generally.feedback

The global economy seems to be gaining momentum – we could be at a turning point. But even as things look up, the post–world war two system of international economic relations is under severe strain despite the aggregate benefits it has delivered – and precisely because growth and the resulting economic adjustments have too often entailed unequal rewards and costs within countries. Consistently good economic news since summer 2016 is starting to add up to a brightening global outlook.feedback

If a fiscally driven demand increase collides with more rigid capacity constraints, a steeper path for interest rates will be necessary to contain inflation, the [US] dollar will appreciate sharply, real growth will be lower, budget pressure will increase and the US current account deficit will widen.feedback

Much of the better growth performance we expect this year and next stems from improvements in large emerging market and low income economies that in 2016 were exceptionally stressed. That being said, compared to our view in October, we now think that more of the lift will come from better prospects in the US, China, Europe and Japan.feedback

At this early stage...the specifics of future fiscal legislation remain unclear, as do the degree of net increase in government spending and the resulting impacts on aggregate demand, potential output, the Federal deficit, and the dollar.feedback

Markets have noted that the White House and Congress are in the hands of the same party for the first time in six years, and that change points to lower tax rates and possibly higher infrastructure and defence spending.feedback

The global economic landscape started to shift in the second half of 2016.feedback

Taken as a whole, the world economy has moved sideways. Without determined policy action to support economic activity over the short and longer terms, sub-par growth at recent levels risks perpetuating itself. In short, growth has been too low for too long, and in many countries its benefits have reached too few - with political repercussions that are likely to depress global growth further.feedback

As of June 22nd we were prepared to upgrade our 2016-2017 growth projections slightly. But Brexit has thrown a spanner in the works.feedback

The real effects of Brexit will play out gradually over time, adding elements of economic and political uncertainty. This overlay of extra uncertainty, in turn, may open the door to an amplified response of financial markets to negative shocks.feedback

In many countries the lack of wage growth and greater inequality have created widespread senses that economic growth has mainly been to the benefit of economic elites.feedback

Global growth continues, but at an increasingly disappointing pace that leaves the world economy more exposed to negative risks. Growth has been too slow for too long.feedback

Several large emerging market economies face deep contractions due to internal political strife or geopolitical pressures and a number of low-income countries suffer El Nino-related drought or flooding. The costs could escalate.feedback

We don't see a big change in the fundamentals in China compared to what we saw six months ago, but the markets are certainly very spooked by small events there that they find hard to interpret. It's not a stretch to suggest that [markets] may be reacting very strongly to rather small bits of evidence in an environment of volatility and risk aversion.feedback

China has been transitioning to a model in which there is less of a dependence on exports, on investment, and more on consumption and services at the expense of traditional manufacturing industries.feedback

Currency management is an area where the Chinese authorities could be communicating more clearly with markets.feedback

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Quotes by Maurice Obstfeld on IMF

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