Comments from IMF economist Obstfeld after the latest world growth estimates
- We see wider dispersion of risks, tilted to the downside
- Trade disruption is a downside risk that isn't included in baseline case
- Effects of Brexit are likely to be complex
- A US fiscal expansion would have positive spillover effects
- We know direction of US policy but not the specifics
- All nations would lose from a trade war
- Some US proposals could hurt the US even without a trade war
- Fixing Italy's banking sector would boost growth
- Fed independence must be maintained and a strict legal rule would tie it's hands
This is the usual stuff from the regular economic orthodoxy. The latest IMF forecasts are here.
