Global | The IMF and the teenage audience

The International Monetary Fund (IMF) has just published its three flagship reports analyzing the state of play and policy recommendations on the economy (WEO), fiscal policy (Fiscal Monitor) and the financial environment (GFSR). Excellent readings with very elaborate recommendations.

Key points

• Key points:
• The first two discuss the challenges of growth going forward (focusing on China and Europe) and the need to pivot to a cycle in which interest rates continue to fall gradually, public deficits are reduced to stabilize debt, and structural reforms are made to underpin the growth of productivity.
• The message is a bit watered down because central banks are already lowering rates; few countries are willing or able to make structural reforms with an impact; and its recommendations for fiscal adjustment are based on gradualism and caution, given that debt is very high and on an upward path, that public spending is going to increase and that we are in a world that underestimates the expected path of public debt and in which there is a certain allergy to increasing spending efficiency or tax revenues.
• The meetings were dominated by the upcoming US elections with polls showing an increase in the intention to vote for Trump, a candidate with proposals that are at the very least unpalatable and worrying for economists with a more liberal and international focus.
• The most heated debate focused on the possible imposition of tariffs by the United States, limitations on China and third countries, the impact of immigration measures - the main source of growth in many advanced countries - and the possible response of third parties to all these measures.

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