2021 Comprehensive Surveillance Review Background Paper On Systemic Risk And Macroprudential Policy Advice In Article Iv Consultations

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2021 Comprehensive Surveillance Review— Background Paper on Systemic Risk and Macroprudential Policy Advice in Article IV Consultations

International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
2021 Comprehensive Surveillance Review Background Paper on Systemic Risk and Macroprudential Policy Advice in Article IV Consultations Book PDF

Author : International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Publisher : International Monetary Fund
Page : 33 pages
File Size : 51,5 Mb
Release : 2021-05-18
Category : Business & Economics
ISBN : 9781513582719

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2021 Comprehensive Surveillance Review— Background Paper on Systemic Risk and Macroprudential Policy Advice in Article IV Consultations by International Monetary,International Monetary Fund. Strategy, Policy, & Review Department Pdf

This paper assesses progress made in deepening and integrating systemic risk analysis and macroprudential policy advice in Article IV consultations following up on the findings of the IEO evaluation. The assessment informs the Comprehensive Surveillance Review and the FSAP Review in their recommendations to strengthen these areas in Article IV consultations. The findings point to notable improvements made since the launch of the macrofinancial mainstreaming initiative, particularly in staff reports for advanced economies and in covering bank and credit-related risks.

2021 Comprehensive Surveillance Review— Background Paper on Traction

International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
2021 Comprehensive Surveillance Review Background Paper on Traction Book PDF

Author : International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Publisher : International Monetary Fund
Page : 26 pages
File Size : 53,9 Mb
Release : 2021-05-18
Category : Business & Economics
ISBN : 9781513582764

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2021 Comprehensive Surveillance Review— Background Paper on Traction by International Monetary,International Monetary Fund. Strategy, Policy, & Review Department Pdf

This paper presents traction as a multidimensional concept and discusses a comprehensive and complementary set of approaches to attempt to measure it based on the Fund’s value added to policy dialogue and formulation and public debate in member countries.

2021 Comprehensive Surveillance Review — Overview Paper

International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
2021 Comprehensive Surveillance Review Overview Paper Book PDF

Author : International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Publisher : International Monetary Fund
Page : 54 pages
File Size : 51,9 Mb
Release : 2021-05-18
Category : Business & Economics
ISBN : 9781513578422

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2021 Comprehensive Surveillance Review — Overview Paper by International Monetary,International Monetary Fund. Strategy, Policy, & Review Department Pdf

Fund surveillance needs to evolve to face the economic and financial challenges that will shape the global landscape for years to come. This paper first takes stock of the current economic and financial landscape. To better serve the membership in this context, Fund surveillance should be prioritized around four key priorities: (i) confronting risks and uncertainties: policymakers will need to actively manage the risks of a highly uncertain outlook; (ii) preempting and mitigating adverse spillovers: shifting patterns of global economic integration will bring about new channels for contagion and policy spillovers; (iii) fostering economic sustainability: a broader understanding of sustainability to better account for the impact of economic and non-economic developments on stability; and (iv) unified policy advice: better accounting for the trade-offs and synergies among different policy combinations in the face of limited policy space and overlapping priorities, tailored to country-specific circumstances. These priorities should further enhance the traction of Fund surveillance.

2021 Comprehensive Surveillance Review— Modalities for Modernizing Surveillance

International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
2021 Comprehensive Surveillance Review Modalities for Modernizing Surveillance Book PDF

Author : International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Publisher : International Monetary Fund
Page : 31 pages
File Size : 54,9 Mb
Release : 2021-05-18
Category : Business & Economics
ISBN : 9781513578477

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2021 Comprehensive Surveillance Review— Modalities for Modernizing Surveillance by International Monetary,International Monetary Fund. Strategy, Policy, & Review Department Pdf

Modern Fund surveillance needs to be more targeted, topical and timely, better interconnected and better informed. Modernizing surveillance will likely require additional resources, although estimates are highly uncertain at this stage. The paper offers a tentative costing of new proposals with significant budgetary implications. Other proposals could rely on optimizing processes, while others are underway and funded separately; the resource implications of yet others are being picked up in context of other workstreams. Estimates do not include short-term transition costs or pressures on support services and are subject to a significant degree of uncertainty. A flexible approach to implementing the new modalities, characterized by experimentation and learning-by- doing—a “sandbox” for new modalities—is proposed.

2021 Comprehensive Surveillance Review— Background Paper on The Surveillance Priority Preempting and Mitigating Spillovers

International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
2021 Comprehensive Surveillance Review Background Paper on The Surveillance Priority Preempting and Mitigating Spillovers Book PDF

Author : International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Publisher : International Monetary Fund
Page : 27 pages
File Size : 53,5 Mb
Release : 2021-05-18
Category : Business & Economics
ISBN : 9781513578910

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2021 Comprehensive Surveillance Review— Background Paper on The Surveillance Priority Preempting and Mitigating Spillovers by International Monetary,International Monetary Fund. Strategy, Policy, & Review Department Pdf

The Fund has a range of modalities and tools to cover spillovers. However, there remains scope to enhance synergies between global and country-specific spillover coverage and to foster cross-country dialogue. Practical guidance and enhanced information-sharing would also allow for more systematic surveillance of spillovers. Furthermore, the COVID-19 pandemic has underscored the need to continue expanding the research frontier covering new spillovers and channels and developing new tools and data sets. Therefore, filling these remaining gaps in the Fund’s spillover work would allow for a more coordinated and evenhanded surveillance of spillovers.

2021 Comprehensive Surveillance Review— Background Paper on The Surveillance Priority Confronting Risks and Uncertainties

International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
2021 Comprehensive Surveillance Review Background Paper on The Surveillance Priority Confronting Risks and Uncertainties Book PDF

Author : International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Publisher : International Monetary Fund
Page : 31 pages
File Size : 47,8 Mb
Release : 2021-05-18
Category : Business & Economics
ISBN : 9781513578613

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2021 Comprehensive Surveillance Review— Background Paper on The Surveillance Priority Confronting Risks and Uncertainties by International Monetary,International Monetary Fund. Strategy, Policy, & Review Department Pdf

The coverage of risks has become more systematic since the Global Financial Crisis (GFC): staff reports now regularly identify major risks and provide an assessment of their likelihood and economic impact, summarized in Risk Assessment Matrices (RAM). But still limited attention is paid to the range of possible outcomes. Also, risk identification is useful only so much as to inform policy design to preemptively respond to relevant risks and/or better prepare for them. In this regard, policy recommendations in surveillance could be richer in considering various risk management approaches. To this end, progress is needed on two dimensions: • Increasing emphasis on the range of potential outcomes to improve policy design. • Encouraging more proactive policy advice on how to manage risks. Efforts should continue to leverage internal and external resources to support risk analysis and advice in surveillance.

2021 Comprehensive Surveillance Review— Background Paper on Integrating Climate Change Into Article IV Consultations

International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
2021 Comprehensive Surveillance Review Background Paper on Integrating Climate Change Into Article IV Consultations Book PDF

Author : International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Publisher : International Monetary Fund
Page : 22 pages
File Size : 54,8 Mb
Release : 2021-05-18
Category : Business & Economics
ISBN : 9781513582689

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2021 Comprehensive Surveillance Review— Background Paper on Integrating Climate Change Into Article IV Consultations by International Monetary,International Monetary Fund. Strategy, Policy, & Review Department Pdf

While the IMF has been involved in the climate debate since at least 2008, a systematic account of how to integrate climate change into surveillance has been lacking to date. This paper seeks to fill the gap. It argues that domestic policy challenges related to climate change—such as adaptation efforts for climate vulnerable countries, or policies to deliver a country’s Nationally Determined Contribution under the Paris climate accord—are covered by the IMF’s bilateral surveillance mandate and therefore valid topics for Article IV consultations wherever these challenges cross the threshold of macro-criticality. Climate change mitigation is a global policy challenge and therefore falls under multilateral surveillance. The paper proposes a pragmatic approach that focusses especially on the mitigation efforts of the 20 largest emitters of greenhouse gases.

Guidance Note for Surveillance Under Article IV Consultations

International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Guidance Note for Surveillance Under Article IV Consultations Book PDF

Author : International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Publisher : International Monetary Fund
Page : 75 pages
File Size : 53,9 Mb
Release : 2022-06-23
Category : Business & Economics
ISBN : 9798400211522

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Guidance Note for Surveillance Under Article IV Consultations by International Monetary,International Monetary Fund. Strategy, Policy, & Review Department Pdf

This Guidance Note provides guidance to country teams for surveillance under Article IV consultations. It supersedes the 2015 Guidance Note and its supplement. Fund surveillance continuously adapts to the evolving economic and financial landscape. The 2021 Comprehensive Surveillance Review (CSR) identified priorities for Fund surveillance, both in terms of content and modalities. This Guidance Note covers: Scope and requirements: The note lays out the coverage of, and formal requirements for, Article IV consultations and staff reports. It also outlines best practices aimed at enhancing the traction of Fund analysis and policy advice. Priorities and focus. The note reflects the four surveillance priorities identified in the CSR: (i) confronting risks and uncertainties, (ii) preempting and mitigating spillovers, (iii) ensuring economic sustainability, and (iv) adopting a more unified approach to policy advice. The note also provides guidance on sharpening the focus and selectivity of Article IV staff reports. Policies. The note discusses the content of surveillance in the areas of fiscal policy, macrofinancial analysis and financial policies, monetary policy, external sector policies, and macrostructural policies. Applications. The note considers several applications of such policies, such as with respect to the Integrated Policy Framework, climate change, and gender. Process and procedures. The note describes the Article IV consultation cycle and process, lays out drafting and publication guidelines for staff reports, and covers the treatment of confidential information.

2021 Comprehensive Surveillance Review— Background Paper on The Surveillance Priority Ensuring Economic Sustainability

International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
2021 Comprehensive Surveillance Review Background Paper on The Surveillance Priority Ensuring Economic Sustainability Book PDF

Author : International Monetary,International Monetary Fund. Strategy, Policy, & Review Department
Publisher : International Monetary Fund
Page : 33 pages
File Size : 47,9 Mb
Release : 2021-05-18
Category : Business & Economics
ISBN : 9781513578996

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2021 Comprehensive Surveillance Review— Background Paper on The Surveillance Priority Ensuring Economic Sustainability by International Monetary,International Monetary Fund. Strategy, Policy, & Review Department Pdf

Ensuring economic sustainability is key to achieving the IMF’s surveillance mandate of maintaining present and prospective balance of payments and domestic stability, assuring orderly exchange arrangements, and promoting a stable system of exchange rates. A good understanding of issues related to economic sustainability is thus essential for the IMF to provide effective surveillance and policy advice, while it requires a broad perspective and a long time horizon. With respect to the IMF’s surveillance mandate, the principle of macro-criticality, which guides the IMF’s engagement with its members, is sufficiently flexible and broad, allowing the IMF to cover issues related to economic sustainability. At the same time, given the wide range of issues that are related to economic sustainability, IMF surveillance needs to be selective and focused, with the choice of issues made on a case-by-case basis, considering country circumstances. It also needs to leverage the expertise of other institutions when necessary. The IMF and other institutions have advanced work to enhance analytical frameworks and indicators related to economic sustainability, and this should continue.

2021 Financial Sector Assessment Program Review—Background Paper On Traction

International Monetary,International Monetary Fund. Monetary and Capital Markets Department
2021 Financial Sector Assessment Program Review Background Paper On Traction Book PDF

Author : International Monetary,International Monetary Fund. Monetary and Capital Markets Department
Publisher : International Monetary Fund
Page : 26 pages
File Size : 45,9 Mb
Release : 2021-05-28
Category : Business & Economics
ISBN : 9781513583396

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2021 Financial Sector Assessment Program Review—Background Paper On Traction by International Monetary,International Monetary Fund. Monetary and Capital Markets Department Pdf

A key criterion for judging the success of the Financial Sector Assessment Program (FSAP) is the extent to which the program has enhanced the IMF’s engagement with policymakers and influenced country policies. This reflects the fact that achieving one of the program’s key objectives—reducing the frequency and severity of financial crises—rests on its ability to encourage policy action by country authorities, either directly or through other bilateral and multilateral activities. The “traction” of FSAPs thus reflects the degree to which the program is seen as useful by the authorities and the effect it has in shaping the domestic policy agenda. And the impact that the FSAP may have on wider domestic and international audiences.

Systemwide Liquidity Stress Testing Tool

Ms. Hiroko Oura
Systemwide Liquidity Stress Testing Tool Book PDF

Author : Ms. Hiroko Oura
Publisher : International Monetary Fund
Page : 54 pages
File Size : 51,5 Mb
Release : 2022-12-16
Category : Business & Economics
ISBN : 9798400227585

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Systemwide Liquidity Stress Testing Tool by Ms. Hiroko Oura Pdf

Developing a systemic liquidity stress testing tool is challenging due to data constraints and hard-to-model behavioral factors. There has yet to be a uniformly accepted model partly because the nature of systemic liquidity risks differs significantly across countries. This paper offers a simple Excel-based tool to assess the high-level impact of aggregate liquidity stress on the whole economy and gauge its spillover across banks, non-bank financial institutions (NBFIs), and non-financial economic sectors. It primarily uses the balance sheet approach (BSA) data—a sector-aggregate matrix of financial exposure by counterpart—that have become increasingly available for various economies with all income levels. The results can identify systemically important financial linkages to be analyzed further and help calibrate macroprudential measures and a liquidity support framework. When liquidity stress stems from capital outflows, the tool can enrich policy discussion based on integrated policy framework (IPF) and international reserve adequacy perspectives.

Guidance Note for Surveillance Under Article IV Consultations

International Monetary Fund
Guidance Note for Surveillance Under Article IV Consultations Book PDF

Author : International Monetary Fund
Publisher : International Monetary Fund
Page : 57 pages
File Size : 52,9 Mb
Release : 2015-03-20
Category : Business & Economics
ISBN : 9781498344845

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Guidance Note for Surveillance Under Article IV Consultations by International Monetary Fund Pdf

This note provides country teams with guidance on bilateral and multilateral surveillance in the context of Article IV consultations. It covers the following issues: Focus on stability. Stability is the organizing principle of surveillance. Article IV consultations should focus on the conduct of economic and financial policies pursued by members to promote present and prospective domestic and balance of payments stability, as well as global economic and financial stability. For the latter, Article IV consultations should discuss spillovers from members’ economic and financial policies that may significantly affect global stability, including alternative policy options that would minimize their adverse impact. Operational guidance. The note provides detailed guidance, suggestions and references in areas covered in surveillance including risks and spillovers, fiscal policy, macrofinancial and monetary policy, BOP stability, structural policies and data issues. Communication and Engagement. Effective two-way communication is key to surveillance, including with the authorities (to help staff’s advice get traction), the Executive Board (to support effective peer review), and the public and other stakeholders (to gain support for necessary policy adjustments). Surveillance messages need to be clear, concise, and focused. The Fund needs to be evenhanded, in line with the principle of uniformity of treatment, for surveillance to command the confidence of the membership. Process and formal requirements. A number of procedures, rules, and requirements are summarized in this note.

Review of The Institutional View on The Liberalization and Management of Capital Flows

International Monetary Fund
Review of The Institutional View on The Liberalization and Management of Capital Flows Book PDF

Author : International Monetary Fund
Publisher : International Monetary Fund
Page : 98 pages
File Size : 40,6 Mb
Release : 2022-03-30
Category : Business & Economics
ISBN : 9798400204593

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Review of The Institutional View on The Liberalization and Management of Capital Flows by International Monetary Fund Pdf

The Institutional View (IV) on the Liberalization and Management of Capital Flows, adopted in 2012, provides the basis for consistent advice, and where relevant, assessments on policies related to capital flows. This paper reviews the IV, informed by advances in research, notably the work on an Integrated Policy Framework (IPF), the findings of the 2020 evaluation by the Independent Evaluation Office (IEO) on IMF Advice on Capital Flows, and staff’s experience with the implementation of the IV. The core premises and objectives of the IV remain unchanged. The IV rests on the premises that capital flows are desirable as they can bring substantial benefits for countries, and that capital flow management measures (CFMs) can be useful in certain circumstances but should not substitute for warranted macroeconomic adjustment. With those premises in mind, the IV aims to help countries reap the benefits of capital flows, while managing the associated risks in a way that preserves macroeconomic and financial stability and does not generate significant negative outward spillovers.

Approaches to Macrofinancial Surveillance in Article IV Reports

International Monetary Fund. Strategy, Policy, & Review Department,International Monetary Fund. Monetary and Capital Markets Department
Approaches to Macrofinancial Surveillance in Article IV Reports Book PDF

Author : International Monetary Fund. Strategy, Policy, & Review Department,International Monetary Fund. Monetary and Capital Markets Department
Publisher : International Monetary Fund
Page : 44 pages
File Size : 41,8 Mb
Release : 2017-03-28
Category : Business & Economics
ISBN : 9781498347037

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Approaches to Macrofinancial Surveillance in Article IV Reports by International Monetary Fund. Strategy, Policy, & Review Department,International Monetary Fund. Monetary and Capital Markets Department Pdf

The Fund has made good progress over the past two years in integrating macrofinancial analysis into Article IV surveillance for a wide range of members. Building on past work to enhance financial sector analysis, Fund staff has sought to develop a consistent and forward-looking view on how the financial sector affects each member’s economic outlook with the aim of strengthening staff’s capacity to provide advice on macro-critical questions. The focus has been on developing a fuller understanding of macrofinancial linkages, and applying this analysis to inform policy advice. Staff has sought to articulate the role of the financial sector in the macroeconomic baseline, and to integrate the financial sector into the risk assessment, taking into account both the impact of macro shocks on the financial sector as well as the effect of financial shocks on macroeconomic stability. Strengthening the analytical foundations of this work has helped staff provide advice in all policy areas, including financial sector policies. Staff has tailored macrofinancial analysis to the circumstances of a diverse set of economies. Area departments have taken the lead in selecting 66 economies for enhanced macrofinancial coverage and in identifying topics, drawing on targeted support from functional departments. The choice of coverage has included legacies from the global financial crisis—such as deleveraging and stretched balance sheets in advanced economies and some emerging markets—and more recent challenges such as commodity price shocks, especially in low income countries, and the risks of housing booms. The financial sector’s contribution to growth and inclusion has become an important question in countries across all income groups. Staff sees benefits in mainstreaming this approach across the membership, while continuing to address analytical gaps and adapting to new challenges. The work of the past two years has underscored the criticality of macrofinancial analysis for a diverse range of members, and laid the basis for progressively mainstreaming macrofinancial surveillance across the membership. Building on this progress, staff sees scope for the Fund to deepen its understanding of the macroeconomic effects of financial shocks, to better adapt microprudential and macroprudential policy advice with an assessment of macro-critical risks including systemic risk, and to deepen the analysis of outward spillovers. Staff will also need to continue to adapt the focus of analysis and tools, and seek relevant data, as economic challenges evolve.

Macroprudential Policy Effects

Nina Biljanovska,Sophia Chen,R. Gelos,Deniz Igan,Maria Martinez Peria,Erlend Nier,Fabian Valencia
Macroprudential Policy Effects Book PDF

Author : Nina Biljanovska,Sophia Chen,R. Gelos,Deniz Igan,Maria Martinez Peria,Erlend Nier,Fabian Valencia
Publisher : International Monetary Fund
Page : 52 pages
File Size : 54,8 Mb
Release : 2023-03-31
Category : Electronic
ISBN : 9798400226304

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Macroprudential Policy Effects by Nina Biljanovska,Sophia Chen,R. Gelos,Deniz Igan,Maria Martinez Peria,Erlend Nier,Fabian Valencia Pdf

The global financial crisis (GFC) underscored the need for additional policy tools to safeguard financial stability and ultimately macroeconomic stability. Systemic financial vulnerabilities had developed under a seemingly tranquil macroeconomic surface of low inflation and small output gaps. This challenged the precrisis view that achieving these traditional policy targets was a sufficient condition for macroeconomic stability. Thus, new tools had to be deployed to target specific financial vulnerabilities and to build buffers to cushion adverse aggregate shocks, while allowing traditional policy levers, including monetary and microprudential policies to focus on their traditional roles. Macroprudential policy measures emerged as the solution to this gap. Some of these measures had been used before the GFC (mostly in emerging markets). But it was only after the crisis that they were more widely adopted, and the toolkit expanded. This spurred a growing body of empirical research on the effects and potential shortfalls of these measures, with a further deepening of this knowledge gaining importance as policymakers confront increased financial stability risks in the post-pandemic world. Recognizing that there still is much to learn, this paper takes stock of our expanding understanding about the effects (and side effects) of macroprudential measures by focusing on these questions: What have we learned about the effects of macroprudential policy in containing the buildup of vulnerabilities? What do we know about the effects on economic activity and resilience? How do policy effects vary with conditions and over time? How important are leakages and circumvention? How do the effects on credit depend on other policies?