International Monetary Fund upgrades outlook on Russian Federation as economy recovers

Lester Mason
October 11, 2018

In a new simulation exercise to show trade war risks to the global economy, the International Monetary Fund modeled the effect of an all-out U.S.

Singapore Prime Minister Lee Hsien Loong said the group will redouble efforts to reach a "substantial conclusion" to a regional trade arrangement, the Regional Comprehensive Economic Partnership, by the end of the year.

Thousands of security personnel have fanned out around key venues in Nusa Dua, just south of Bali's main global airport, with some 32,000 delegates, including finance ministers and central bankers, attending the IMF-World Bank meetings.

International Monetary Fund (IMF) chief Christine Lagarde on Thursday defended central bank rate hikes in a veiled rebuke to Donald Trump after the United States president blamed "crazy" Fed policies for contributing to financial market turmoil. "In adverse scenarios, that can be an abrupt reversal of flows".

Adjustments would occur as domestic production displaces higher-priced imports, the model shows, but in the long run, the U.S. GDP would still be 1.0 percent below a baseline without these tariffs, while China's GDP output would be one half percent below the baseline.

Compared to the medium-term risks, near-term risks have risen in the past six months but are "relatively limited" and subdued, relative to historical norms, with financial conditions still broadly accommodative and supportive of growth in the near-term, said the International Monetary Fund.

"We discussed important economic issues", Mnuchin said of their meeting on Twitter.

Trump has led the escalating trade war because of what he believes are bad policies he said have created an $800 billion US trade deficit.

The PBOC did not immediately respond to Reuters' request for comment on Yi's remarks.

That would include boosting foreign currency reserves that could be used in a crisis, as well as working with local bond markets to build a local investor base, rather than relying on financing from overseas. Against a basket of currencies, the yuan has depreciated less.

In a press conference at the White House on Tuesday, President Trump said "China wants to make a deal and ... they're not ready yet", adding that is a reason his administration has canceled a couple of meetings with Beijing.

"De-escalate, fix the system, and don't break it", she said.

The fund last week recommended that the government devalue the rupee by at least 15 percent to curb imports and tame the trade deficit.

Analysts and other fiscal bodies have already warned of the trade war's impact.

"We will get out of this".

The IMF and Pakistan on Thursday launched talks on a new bailout program aimed at easing a mounting balance of payments crisis in the South Asian country.

The International Monetary Fund (IMF) has now projected Pakistan's current account deficit will contract from 5.9 percent of GDP in 2018 (the worst in emerging markets) to 5.3 percent of GDP in 2019 (again the worst in EM).

The IMF and World Bank meetings, attended by more than 19,000 delegates, showed no sign of disruption from an offshore natural disaster early Thursday morning between Bali and Java island that killed three people.

Other reports by Iphone Fresh

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