Global Economy under Stress

Financial System in Crisis

Deepening Housing Corrections

Overstretched Commodity Markets

Have Macroeconomic Policies Been Too Loose?

Prospects for a Turnaround

Policy Challenges for the Global Economy

Appendix 1.1 Assessing and Communicating Risks to the Global Outlook

References

United States and Canada: Bending but Not Buckling

Western Europe: Struggling with Multiple Shocks

Advanced Asia: Responding to External Shocks

Emerging Asia: Balancing Risks to Growth and Price Stability

Latin America and the Caribbean: Navigating a More Perilous Environment

Emerging Europe: Prospects for a Soft Landing

Commonwealth of Independent States: Managing the Commodity Price Boom

Sub-Saharan Africa: A Test of Policy Frameworks

Middle East: Overheating Still A Concern

References

Surging Commodity Prices: Origins and Prospects

Commodity Price Shocks and Inflation

Monetary Policy Responses to Commodity Price Shocks

Summary and Conclusions

Appendix 3.1. Recent Commodity Market Developments

Appendix 3.2. Accounting for Food Price Increases, 2006–08

Appendix 3.3. Estimating Inflationary Effects of Commodity Price Shocks

References

Identifying Episodes of Financial Stress

Financial Stress, Economic Slowdown, and Recession

Has Financial Innovation Affected the Interplay between Financial Stress and Economic Cycles

The Current Financial Crisis in Historical Context

Conclusions

Appendix 4.1. Data and Methodology

References

Understanding the Fiscal Policy Debate

How Has Discretionary Fiscal Policy Typically Responded?

Are Fiscal Policy Reactions Different in Emerging and Advanced Economies?

The Macroeconomic Effects of Discretionary Fiscal Policy

A Simulation-Based Perspective on Fiscal Stimulus

Conclusions and Policy Considerations

Appendix 5.1. Data and Empirical Methods

References

Recent Current Account Patterns in Emerging Economies

What Factors Have Contributed to Recent Current Account Patterns

Sustainability of Current Account Imbalances

Conclusions and Policy Implications

Appendix 6.1. Variable Definitions and Data Source

Appendix 6.2. Econometric Approach

References