Economy, Strategy

Total Loss Absorbing Capacity For Global Systemically Important Banks


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On November 10, 2014 the Financial Stability Board (FSB) issued a long-awaited Consultative Document “Adequacy of loss-absorbing capacity of global systemically important banks in resolution” that defined a global standard for minimum amounts of Total Loss Absorbing Capacity (TLAC) to be held by Global Systemically Important Banks (G-SIBs). TLAC is meant to ensure that G-SIBs have the loss absorbing and recapitalization capacity so that, in and immediately following resolution, critical functions can continue without requiring taxpayer support or threatening financial stability.

The TLAC proposal is one of the final components of a long-standing reform effort laid out in 2010 by the FSB to limit the probability and impact of the failure of large global systemically important financial institutions, i.e., ending the too-big-to-fail (TBTF) phenomenon. At its core, TLAC bolsters capital and leverage ratios, thereby creating a greater capital cushion intended to further pre-empt any need for a taxpayer-funded bail-out.

At the global level, the G20 have agreed to a proposal that G-SIBs will have to fulfill in future regarding their capital structure. In particular, these banks will need to ensure a minimum amount of TLAC, which may be as high as 20 percent including the minimum capital requirements and the G-SIB buffer. This will make global banks more resilient, and it will allow for their orderly resolution.

TLAC will apply in addition to the capital requirements set out in the Basel III framework, including the countercyclical, G-SIB and other capital buffers. The measure appears challenging but manageable for most G-SIBs who will have until 2019 to meet the minimum Pillar 1 requirements.

As per the Consultative Document, the minimum TLAC requirement will be within the range of 16-20 percent of the group’s risk-weighted assets (RWA) and at least twice the fully loaded Basel III leverage ratio requirement. This is considered the “Pillar 1” requirement according to the FSB. Regulatory authorities may set additional requirements above their so-called minima, also known as the “Pillar 2” component of TLAC.

The interest at this stage from traditional consumers of bank paper, such as pension funds and insurers, is lukewarm at best. While the securities, designed to be written down in a crisis, would offer higher yields than senior debt, the risk of bail-in may be more than some buyers can tolerate. That could leave the banks struggling to meet regulatory requirements.

Banks already issue dated subordinated debt with mandatory coupons that banks can count toward some existing loss-absorbency requirements. Those notes, which have an established investor base, potentially could also be used to meet TLAC. That would be expensive: average yields on Tier 2 debt are 1.53 percent, more than double the 0.70 percent yield on banks’ senior bonds in euros, according to Bank of America Merrill Lynch index data.

On February 2, 2015 the Institute of International Finance (IIF) and the Global Financial Markets Association (GFMA) jointly submitted a letter to FSB on the Consultative Document. In general, the industry supports the concept that the FSB has developed. Assuring that loss-absorbing capacity is available if a G-SIB needs to be resolved is something the industry agrees to be essential. Nevertheless, a reform of this magnitude naturally raises many practical issues that have to be considered during the implementation of the new TLAC concept. Thematically, the most important areas include:

  • Historical evidence suggests that 16% of risk-weighted assets will be a sufficient level of TLAC to absorb potential losses for G-SIBs in the future.
  • The current drafting of TLAC subordination requirements raises important implementation difficulties, both for groups funded via holding company structures and for groups funded at the operating parent company or bank level.
  • The disposition of Internal TLAC will involve a delicate balancing of home and host regulatory interests, ideally aligning these interests to support cross-border cooperation.
  • Upon implementation, it’s estimated that the new framework would govern about US$4 trillion in TLAC-eligible securities. For issuance at this scale to be effective, it will need to be supported by broad, deep, liquid and diverse markets.

Last month a slew of European banks issued 10-year bullet maturity Basel III-compliant, tier-2 (B3T2) subordinated bond deals, as they sought to grow a new market for these lower cost TLAC-eligible instruments. Deutsche Bank attracted a €4.4 billion order book for its €1.25 billion deal priced at 210 basis points over mid-swaps. BNP Paribas drew €5.5 billion of demand for its €1.5 billion offering at 170 basis points over, while Société Générale took €3.8 billion of orders for a €1.25 billion transaction at 190 basis points over.

Economy, Weird

Negative-Yield Bond Universe is $2.35 Trillion!


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As part of its €1.1 trillion quantitative easing plan, the European Central Bank (ECB) will buy government bonds due between two- and 30-years, including those with negative yields, President Mario Draghi said in January. The bond buying plan has left $1.9 trillion of the euro region’s government securities with negative yields.

Germany sold five-year notes at an average yield of minus 0.08 percent on February 25, a euro-area record, meaning investors buying the securities will get less back than they paid when the debt matures in April 2020. By the next day, German notes with maturity out to seven years had sub-zero yields — reached minus 0.017 percent. The rates on seven other euro-area nations’ debt were also negative.

The German bond markets are leading this historical phenomenon — 88 of the 346 securities in the Bloomberg Euro zone Sovereign Bond Index have negative yields. Euro-area bonds make up about 80 percent of the $2.35 trillion of negative-yielding assets in the Bloomberg Global Developed Sovereign Bond Index.

The seemingly illogical willingness of investors to pay issuers to borrow their money is neither irrational nor driven by just noncommercial considerations (such as regulatory requirements or forced risk aversion). As the ECB prepares to start its own large-scale purchasing program next week, some investors believe they could make capital gains on such negative yielding investments.

The ultra-low interest rate regime is likely to persist for now and this has caused challenges for banks. A growing number of European banks are now charging depositors for holding their funds.

Mohamed El-Erian commented that there are few analytical models, and even fewer historical examples, to help understand the broader economic, financial, political and social implications of all this — particularly for a global financial system based on the assumption of positive nominal rates. We are truly in unchartered waters. Accentuated by the illusion of market liquidity, this is a world in which small adjustments in probabilities of future outcomes — if and when they occur — could result in sharp movements in asset prices.

References

El-Erian, Mohamed (2015): “10 Things to Know About Negative Bond Yields”, Bloomberg View, February 27.

Goodman, David and Lukanyo Mnayanda (2015): “Germany’s Negative-Yield Universe Extends as ECB Prepares to Buy”, Bloomberg Business, February 26.

Goodman, David and Lukanyo Mnayanda (2015): “Euro-Area Negative-Yield Bond Universe Expands to $1.9 Trillion”, Bloomberg Business, February 28.

Economy, Strategy

JPMorgan Shows Why It Pays To Turn Money Away


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Traditional bank runs were driven by massive withdrawals of deposits by customers. On February 24, JPMorgan Chase & Co. (JPM) announced plans for an inverted bank run — it will push certain customers to withdraw what one executive has described as bad deposits.

Central banks around the world have pushed since the crisis to increase the minimum amount of capital that banks hold, in the hope that it will protect banks in the case of a crisis. Banks can increase their capital by raising money from shareholders or retaining profits, but this generally makes the cost of doing business more expensive.

Bigger banks have always had to hold more capital, but in December the Federal Reserve Bank proposed new surcharges for the largest, most systemically important banks, and indicated that JPM would face a higher surcharge than any other institution. The so-called GSIB surcharge is expected to force JPM to hold 4.5% more capital than a standard bank. The way this surcharge will be calculated under the rules proposed by the Fed in December “heavily penalizes” non-operational deposits.

JPM says it plans to reduce such deposits by up to $100 billion by the end of the year. The unwanted funds are primarily “non-operational deposits” from financial institutions. That is, deposits that aren’t connected to a company’s daily cash management, payment services or other banking activities.

According to JPM’s CFO: so-called “non-operational deposits”, which account for about $200 billion of JPM’s $390 billion in deposits from financial institutions, provide minimum net income and provide no liquidity benefit.

JPM is willing to turn away such funds speaks volumes about the new, more-stringent regulatory climate facing the biggest banks, as well as the continued pressure being exerted by the super low interest-rate environment.

Under the new regime, a big hedge fund or private equity firm or a foreign bank would be encouraged to shift excess cash into other JPM products such as money market funds, or find a new bank to hold their money.

The primary impetus for JPM’s deposits move is a new liquidity rule that looks to ensure banks have a healthy stock of assets that can easily be converted to cash in a stress scenario. It obliges banks to invest all uninsured, non-operational deposits from financial companies in officially sanctioned “high-quality liquid assets.” In practice, most are effectively placed as cash at the Federal Reserve. As a result, these assets earn little to no returns and can’t be used to fund loans. That reduces interest income and squeezes net interest margins, or the difference between what a bank makes borrowing and lending money.

Cash moved out of non-operational deposits will most likely find its way into money-market funds, short-duration bond funds and individual securities. Increased demand for safe assets from these investors could put further downward pressure on interest rates.

In the meantime, it is likely that more banks will follow JPM’s lead in chasing away unattractive deposits.

References

Carney, John and David Reilly (2015): “J.P. Morgan Shows Why It Pays to Turn Money Away”, The Wall Street Journal, February 24.

McLannahan, Ben (2015): “JPMorgan to charge fees for big deposits”, Financial Times, February 24.

Popper, Nathaniel (2015): “JPMorgan Chase Insists It’s Worth More as One Than in Pieces”, The New York Times, February 24.

Random

Never Use Indiangiftsportal.com


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I have been sending flowers, cakes etc in India through fernsnpetals. I don’t know why I thought of trying other e-commerce websites this time. I found indiangiftsportal.com website quite interesting, so thought of trying their service. They claim: “15 years of trusted gifting worldwide !!!”

But, this was my blunder of believing the claim. It spoiled my valentine day. I wanted to send flowers & chocolates to my wife. I booked it on February 11th. The website assured delivery on February 14th. The items are yet to be delivered and it’s more than 8 days past the day. The “track order” shows “dispatched”. But where? and how? I sent them two reminders but I am yet to receive any response.

It’s a case of very bad delivery for me and even if it reaches tomorrow it’s of no use. Gifts are meant for occasions and after that day, gifts are useless. I am forced to write down the financial loss but what about the loss of face? Dear readers, if you are reading my story and feeling my agony, then please never use the services of indiangiftsportal.com. Your loved ones may have to wait until the next anniversary to receive your gift!

Economy, Strategy

Bolstering Financial Inclusion


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Financial deepening has accelerated in emerging market and low-income countries over the past two decades. The record on financial inclusion, however, has not kept apace. Large amounts of credit do not always correspond to broad use of financial services, as credit is often concentrated among the largest firms. Moreover, firms in developing countries evidently continue to face barriers in accessing financial services. The lack of financial inclusion contributes to persistent income inequality and slower growth and lack of access to basic financial services is still a major challenge in developing countries.

Large gaps exist in worldwide access to finance. 58% of the firms in developing countries and only 20% of those in low-income countries have access to bank credit. 51% of firms in advanced economies use a bank loan or line of credit as compared with 34% in developing economies.

Given that financial inclusion is multi-dimensional, involving both participation barriers and financial frictions that constrain credit availability, policy implications to foster financial inclusion are likely to vary across countries. Small and medium enterprises (SME) continue to face barriers that further impede access to finance, such as high costs, high collateral requirements, travel distance, and onerous paperwork. This forces individuals to rely on their limited savings to become entrepreneurs. Once established, these enterprises tend to depend on self-financing to meet investment needs. This, in turn, limits the overall size of the firm, the ability to innovate, and productivity.

To examine how best to increase financial inclusion, IMF conducted a study on three low-income countries: Kenya, Mozambique and Uganda and on three emerging market (EM) countries: Egypt, Malaysia, and the Philippines. They have found:

  1. Disentangling constraints to financial inclusion is crucial. Understanding the specific factors that hold back financial inclusion, therefore, is critical for tailoring policy advice. The focus of public policy should thus be on ameliorating the most pressing financial frictions.
  2. Distributional consequences could be sharp. The consequences of increased financial inclusion can be uneven. It’s observed that the most effective policy for increasing access to finance — lowering the cost of participation in the financial system — benefits the poor, but wealthy firms can lose somewhat as a result of higher interest rates and wages. By contrast, it’s found found that policies that target financial depth — such as relaxing collateral requirements — benefit productive firms. Yet such policies also can impose losses on less productive firms as well as those with low credit demand, regardless of whether financial inclusion policies are in effect.

Different dimensions of financial inclusion can result in different distributional consequences. There is no one-size-fits-all policy prescription for increasing financial inclusion. A key first step is to develop appropriate legal, regulatory, and institutional frameworks and a supporting information environment.

The government has a central role to play in dismantling obstacles to financial inclusion by introducing laws that protect property or creditor rights and ensuring that these laws are adequately enforced. It can also set standards for disclosure and transparency and promote credit information-sharing systems and collateral registries. More fundamentally, it has a role in educating and protecting consumers.

Governments could also consider policies such as granting exemptions from onerous documentation requirements, allowing alternate delivery channels like banking correspondents, and shifting to the use of electronic payments into bank accounts for government payments. By moving forward with these policy measures, governments can make big inroads into increasing financial inclusion, reducing inequality, and boosting growth.

Art, Family, Food, Leisure

An Afternoon In Kolkata Book Fair


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indexI was returning from Gangtok on a two-week holiday from my institute after our third-year examination on February 1. My mom was in Kolkata to attend her friend’s daughter’s marriage followed by her routine medical checkups and consultations. So, I joined her in Kolkata. After her checkups and consultations at Apollo Gleneagles Hospital, on February 2, we decided to go for the Kolkata Book Fair (কলকাতা বই মেলা) in the afternoon. One of my friends Manali also joined us there. The fair is being held at “Milan Mela” near Science City on E.M. Bypass. Two years ago, while returning from Kumbh Mela we couldn’t visit the book fair as that was the last day and I didn’t want to miss the chance this time.

International Kolkata Book Fair is a late winter fair in Kolkata. It is a unique book fair in the sense of not being a trade fair – the book fair is primarily for the general public rather than whole-sale distributors. It celebrates international literature and reflects India’s much-loved reading tradition. The Kolkata Book Fair, recognised by International Publishers Association, Geneva, is also the largest Book Fair of the world in terms of visitors.

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It’s reported that the last year’s edition of International Kolkata Book Fair was visited by around 2 million book-lovers over 12 days and books worth Rs 200 million ($3.25 million) were sold. It is the world’s third largest annual conglomeration of books after the Frankfurt Book Fair and the London Book Fair.

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The focal theme this year was Great Britain. The fair was divided into five big pavilions. Each of the pavilions contained different publication houses from India and abroad. The pavilions were very large and had mammoth collection of books from almost all subjects and interests one can imagine. I could not visit all of them but I visited two of the pavilions. One of them was containing British publishers like Oxford University Press, Cambridge University Press, etc. The Oxford stall was no less than a usual Oxford bookstore having books ranging from kids fiction categories to business books. They even had comics of great Japanese series like bleach and one piece (my favorite).  There were stalls especially for research books  covering every field from biomechanics to elementary physics and astrophysics.

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In the other one, there were stalls for local publishers like Ananda Publishers, Dey’s Publishing, etc. These stalls had basically all the Bengali books and novels ranging from Rabindranath Tagore and Satyajit Ray to current writers. There were separate stalls outside the pavilions. Other than that there were small stalls of different bookstores outside of the pavilions. This book fair could feed needs of every reader. it’s truly a paradise of book-lovers.

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The delicious attraction of this book fair was the food court — the gastronomic section where variety of snacks, sweets & confectionaries and other food items were available. There were outlets of Dominos, Kathleen, Laziz, Roll’nRoll, Alibaba etc. Some famous restaurants of Kolkata had also opened their stalls there.

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Mind-boggling varieties of dishes — very difficult to choose

They were serving delicious, mouth-watering dishes like fish fry, chicken rolls, prawn chilli to biryani and even different flavored patishapta (Indian style crepes stuffed with sweet fillings).

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Mom and Manali looking liliputs :-)

There was even a tall guy standing on sticks, wearing a menu card of one of the food stalls in the food court, inviting people to the stall.

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WP_20150202_018The other attraction of this fair that I found out interesting was different forms of artwork which I saw there. It was amazing to find artists actually working there on the spot and painting bottles, clothes and many different things that we generally dispose off after use.

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This actually proved a good point in reusing the refuse. The idea is very inspiring and I was excited to see them doing that on the spot. This is good for our nature and sustainability.

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An artist busy in creating a masterpiece

I love reading books and was very thrilled to be there. We visited many pavilions but couldn’t visit all of them due to paucity of time. We bought a Kindle for my dad — it is for his birthday gift. I bought several books. I wanted to buy more books but couldn’t buy more as we had to go to our home in Ranchi next day. I missed my dad very much as he is fond of books and he loves reading books. The time was too short although we were there for more than 4 hours. Any number of hours — even a full day is too short for this book fair. I felt bad that I could only visit two halls.

A good book has often been called a man’s best friend, or as Groucho Marx puts it, “Outside of a dog, a book is man’s best friend. Inside of a dog it’s too dark to read.”

Atri Bhattacharya has rightly said: “The Kolkata Book Fair (KBF) is a phenomenon. Large. Crowded. Noisy. Intellectual. (Oh, very intellectual!) Musical. Gastronomic. Artistic. Controversial. Chaotic. Resilient. In its own way, it encapsulates the character of its city and its most visible tribe: The literary Bengali.”

Economy

Much-needed Correction Or Dubious Data?


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India changed its gross domestic product (GDP) calculations and caught everyone by surprise on January 30th, with the revisions suggesting Asia’s third-largest economy is in much better shape than we thought it was.

The government now will calculate growth based on 2011-12 market prices rather than the previous method of using 2004-05 factor costs. The changes are due to a database that includes more companies, better coverage of rural and urban government bodies, and the inclusion of taxes. Information is also included from stock brokers and exchanges, as well as mutual and pension funds and market regulators.

The new methodology indicates that Indian economy surged 6.9% in the year through March 2014 instead of the previously reported 4.7%, while GDP marginally contracted to 113.5 trillion rupees ($1.83 trillion) from 113.6 trillion. The revision takes India’s growth closer to the fastest-growing major economy in the world, China’s 7.4%.

Although the new method brings the Indian data in line with the International Monetary Fund (IMF) and global counterparts, the extent of upward revision is quite sharp and all future estimates have to be re-calibrated. The consequences of the inability to accurately chart a trend could be immediate. Reserve Bank of India (RBI) is meeting tomorrow to decide whether to cut rates for a second time in three weeks, had earlier predicted that inflation would stay below-target until January 2016, based on  forecast of growth at 5.5% for the current fiscal year.

Celebration, Festival, Food

Republic Day 2015 in Baghdad


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India celebrates January 26th every year as her Republic Day to mark the date when the Constitution of India came into force. The constitution was adopted on January 26th, 1950 with a democratic government system. It was this day in 1930 when the Declaration of Indian Independence (Purna Swaraj) was proclaimed by the Indian National Congress.

The Indian embassy in Baghdad organizes the flag hoisting ceremony on the morning at the embassy residence and a reception in the afternoon. I received emailed invitation to attend the ceremony and reception a week ago. The Indian embassy and the residence are in our neighbourhood. I walked from my office to the embassy residence for the Flag hoisting ceremony scheduled at 8:30 am.

Today is the 66th Republic Day of India. The Flag hoisting ceremony started with hoisting of  the Indian flag by Ambassador H.E. Ajay Kumar followed by singing of national anthem by all the Indians present there. There is a very small Indian community in Baghdad. Most of the Indians in Iraq are in Kurdistan region. 

Flag hoisting at Indian Embassy in Baghdad on Republic Day. #26January

A photo posted by Indrajit Roy Choudhury (@iroychoudhury) on

It was then followed by reading of the President’s message to the Nation by the Ambassador. The printed message of the President to the Nation was also given to the attendees. The embassy arranges for breakfast for the guests of the ceremony. They served us nice hot pakoras, falafel and tea. We had some small chat with Ambassador Ajay Kumar, HOC DV Singh and others and then I returned to my office. 

With Indian Ambassador and HOC at Embassy residence in Baghdad after flag hoisting on #26January

A photo posted by Indrajit Roy Choudhury (@iroychoudhury) on

This time the reception is scheduled at 5:30 pm. For last several years the reception was from 3.00 pm. I went to the embassy residence at 5:20 pm for the reception. The reception was attended by dignitaries from other embassies, Iraqi political establishments and a tiny cross-section of the local Indian community in Baghdad. National anthem was played. Speeches were delivered on India-Iraq relationships. The function ended with Indian dinner that included Chicken Butter Masala, Chicken tikka, Paneer, Dal, Pulao & Paratha besides other side dishes. The meal was supplied by a restaurant run by our friend Vivekanand inside International Zone.  We also had a nice chat with our friend Akhtar as he was waiting for his car to arrive. Akhtar is a frequent visitor to Baghdad as he is running a business here.

I walked back to my home in the evening. It’s a very sad evening for me as it was this evening ten years ago when my mother left us for her eternal abode. We were then staying in Jamshedpur as I was then posted there. I miss you, Maa!

I wish Happy Republic Day to all my fellow Indians. Vande Mataram! Jai Hind!

Economy

“If poverty were communicable, its incidence would be far lower by now”


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I today read an excellent article — The State of Global Poverty by Senior Vice President and Chief Economist of the World Bank Kaushik Basu in Project Syndicate. Here is an excerpt from his article.

The economic geography of the world is changing. The eurozone faces the specter of another round of stagnation; Japan has slipped into recession; and the United States, despite relatively strong performance in the latter part of 2014, has raised concerns worldwide with its exit from quantitative easing. Meanwhile, emerging economies have continued to perform well. India and Indonesia are growing at more than 5% per year; Malaysia at 6%; and China by more than 7%.

The scale of the global change can be seen when purchasing power parity (PPP) – a measure of the total amount of goods and services that a dollar can buy in each country – is taken into account. According to the figures for 2011, released last year, India is now the world’s third largest economy in terms of PPP-adjusted GDP, ahead of Germany and Japan. The data also revealed that China would overtake the US as the world’s largest economy in PPP terms sometime in 2014 – a shift that, according to World Bank estimates, occurred on October 10th.

Despite this progress, a large proportion of people in developing countries remain desperately poor. Globally, the poverty line is defined as a daily income of $1.25, adjusted for PPP – a line that many criticize as shockingly low. But what is truly shocking is that nearly one billion people – including more than 80% of the populations of the Democratic Republic of Congo, Madagascar, Liberia, and Burundi – live below it.

One reason global poverty has been so intractable is that it remains largely out of sight for those who are not living it, safely somebody else’s problem. If poverty were communicable, its incidence would be far lower by now.

Another reason poverty endures is persistent – and, in many places, widening – inequality. The current level of global inequality is unconscionable. According to some back-of-the-envelope calculations, the wealth of the world’s 50 richest people totals $1.5 trillion, equivalent to 175% of Indonesia’s GDP, or a little more than Japan’s foreign-exchange reserves. If one assumes that this wealth yields 8% per year, the annual income of the world’s 50 wealthiest people is close to the total income of the poorest one billion – in other words, those living below the poverty line.

Economy

Global Economy Faces Strong And Complex Cross Currents


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The world economy is facing strong and complex cross currents.  On the one hand, major economies are benefiting from the decline in the price of oil.  On the other, in many parts of the world, lower long run prospects adversely affect demand, resulting in a strong undertow.

International Monetary Fund (IMF) released World Economic Outlook Update yesterday in Beijing, China. IMF expect stronger growth in 2015 than in 2014, however their forecast is down from last October. The forecast for global growth in 2015 is 3.5%, three-tenth of a percent higher than global growth in 2014, but three-tenth of a percent less than their forecast in October. For 2016,  IMF forecast 3.7% growth, again a downward revision from the last World Economic Outlook.

The cross currents make for a complicated picture for the countries. Good news for oil importers, bad news for exporters. Good news for commodity importers, bad news for exporters. The oil price decline increases real income, decreases costs of production for firms, and both lead to more spending. The effect can potentially be large. To the extent that the price decrease is persistent, oil exporters will have to reduce their level of government spending. Some energy firms may also face financial risks.

Since August 2014, the dollar has appreciated in real terms by 7%, the euro has depreciated by 3%, and the yen by 10%. Good news for countries more linked to the euro and the yen, bad news for those more linked to the dollar. In short, many different combinations, many different boxes, and countries in each box.

IMF forecasts reflect the increasing divergence between the United States on the one hand, and the Euro area and Japan on the other.  For 2015, they have revised US growth up to 3.6%, Euro area growth down to 1.2%, Japan growth down to six-tenth of a percent. Some of the largest downward revisions are in emerging markets, notably in Sub-Saharan Africa, the economies of the Commonwealth of Independent States (CIS), and Latin America. They were smaller in Emerging Asia, where growth is still very high, particularly in its leading economies like India (6.3% for 2015 and 6.5% for 2016) and China (6.8% for 2015 and 6.3% for 2016).

Unfortunately, the positive developments are offset by bad news on a number of fronts. Economic Counsellor and Director of the Research Department of the IMF Olivier Blanchard said that assessing the favorable effects of the decline in the price of oil in the current environment is difficult. This decline may turn out to be a stronger “shot in the arm” than is implicit in the forecasts.

References

Blanchard, Oliver (2015),  Global economy faces strong and complex cross currents, iMFdirect – The IMF Blog, 19 January.

International Monetary Fund (2015),  World Economic Outlook Update, IMF, January.