Keeping up with the world economy: the IMF’s Article IV reports

The International Monetary Fund (IMF) provides some of the best economic analysis around. For example, twice per year they publish their World Economic Outlook along with a database chock full of good stuff. The media often focus on the report’s forecasts of economic growth and the like, but I find it to be a great first draft of recent economic history: what happened, where did it happen, why did it happen, who was affected?

My favorite source is the IMF’s Article IV reports.  Want to know what’s up with the US economy? Start with the 2016 Article IV report:

The United States economy is, overall, in good shape. A total of 2.4 million new jobs were created over the past year and unemployment has fallen to 4.7 percent, its lowest level since the eve of the “Great Recession.” Inflation remains contained, and the U.S. economy has repeatedly demonstrated its resilience in the face of financial market volatility, a strengthening dollar, and subdued global demand.

Despite these important achievements, the U.S. faces potentially significant longer-term challenges to strong and sustained growth. Concerted policy actions are warranted, sooner rather than later.

You can then bore down into the data, into IMF staff analysis, and learn almost everything you need.

Today, the IMF released their 2016 Article IV report for China. The report noted the following challenges (all are quotes, bold is mine):

  • China’s economic transition will continue to be complex, challenging, and potentially bumpy, against the backdrop of heightened downside risks and eroding buffers. They [IMF directors] stressed the need for decisive action to tackle rising vulnerabilities; reduce the reliance on credit-financed, state-led investment; and improve governance, risk pricing, and resource allocation in the state-owned enterprise (SOE) and financial sectors
  • macroeconomic policies should be geared at lowering vulnerabilities, which would likely entail somewhat slower growth in the short term.
    • Measures could include raising pensions; increasing social, education and health spending; providing restructuring funds; and cutting minimum social security contributions. Continued efforts are also needed to ensure full implementation of the new budget law, improve fiscal transparency, and modernize the tax system
  • Directors underscored the importance of further enhancing financial stability.

So, if you want to know what challenges to pay attention to in China, here they are.

It’s all available for free via the IMF website. You can also subscribe to get the Article IV reports and other documents via email when they’re issued, which is what I do. It’s a conventient, reliable way to keep up with all that’s going on the global economy.