Show an ad over header. AMP

IMF sees turmoil as pandemic rages on

The world is in desperate need of cooperation and unity to pull out of the coronavirus pandemic and begin what the IMF has termed the "long, difficult ascent" right as its leaders are increasingly focused on nationalism and decoupling.

Driving the news: The IMF raised its 2020 global growth outlook, largely because of improved expectations for China, but cut its longer-term forecast, citing slower growth. Policymakers expressed worries about a number of "setbacks" that could hobble its diminished forecast with potentially significant "scarring" in the long term.


  • "The scarring is expected to compound forces that dragged productivity growth lower across many economies in the years leading up to the pandemic — relatively slow investment growth weighing on physical capital accumulation, more modest improvements in human capital, and slower efficiency gains in combining technology with factors of production," IMF leaders said in the latest World Economic Outlook.
  • "The uncertainty surrounding the baseline projection is unusually large."

What we're hearing: "I worry most about withdrawing support to workers and firms prematurely because it could cause a wave of bankruptcies and massive increase in unemployment," IMF head Kristalina Georgieva said during a media briefing Wednesday.

  • "We are advising all governments, 'Do as much as you can, don’t cut financial lifelines too early.'"

By the numbers: Already, the World Bank has warned the pandemic will push an additional 88 million to 115 million people into extreme poverty this year, with the total rising to as many as 150 million by 2021.

The big picture: Without global leadership on the issue from either of the world's two largest economies, the IMF and World Bank have attempted to fill the void but are already far overextended for a crisis that is just beginning in much of the developing world.

  • Since March, the IMF has provided "10 times" as much economic support to the world's developing countries as it does in a normal year, Georgieva said.
  • The Fund is calling for multilateral efforts to reduce the debt held by developing countries, an effort that has so far fallen on mostly deaf ears in China and at asset management firms in the U.S. and Europe.

The bottom line: For many countries, the immediate shock and bounce that has followed over the past few months has been the light work.

  • Now comes "the really hard part of the recovery," Brian Coulton, chief economist at Fitch Ratings, said during a presentation for the Institute of International Finance's annual meeting Tuesday.
  • "We’ve got another 18 months ahead, at least."

Bond investors see brighter days

U.S. government bonds could breakout further after yields on the benchmark 10-year Treasury note ticked up to their highest since early June last week.

But, but, but: Strategists say this move is about an improving outlook for economic growth rather than just inflation.

Keep reading... Show less

The dangerous instability of school re-openings

Schools across the country have flip-flopped between in-person and remote learning — and that instability is taking a toll on students' ability to learn and their mental health.

The big picture: While companies were able to set long timelines for their return, schools — under immense political and social strain — had to rush to figure out how to reopen. The cobbled-together approach has hurt students, parents and teachers alike.

Keep reading... Show less

Trump doesn't have a second-term economic plan

President Trump has not laid out an economic agenda for his second term, despite the election being just eight days away.

Why it matters: This is unprecedented in modern presidential campaigns, and makes it harder for undecided voters to make an informed choice.

Keep reading... Show less

How Trump’s energy endgame could go

Expect President Trump to redouble his efforts loosening regulations and questioning climate-change science should he win reelection next month.

Driving the news: A second Trump administration would supercharge efforts by certain states, countries and companies to address global warming. But some wildcards could have a greener tinge.

Keep reading... Show less

The swing states where the pandemic is raging

Data: The COVID Tracking Project, The Cook Political Report; Table: Andrew Witherspoon/Axios

Several states that are likely to decide which party controls Washington next year have exceptionally large coronavirus outbreaks or are seeing cases spike.

Why it matters: Most voters have already made up their minds. But for those few holdouts, the state of the pandemic could ultimately help them make a decision as they head to the polls — and that's not likely to help President Trump.

Keep reading... Show less

Tropical Storm Zeta may strengthen into hurricane before reaching U.S.

The U.S. Gulf Coast and Mexico are bracing for another possible hurricane after Tropical Storm Zeta formed in the Caribbean Sea Sunday.

Of note: Zeta is the 27th named storm of the 2020 Atlantic Hurricane season — equaling a record set in 2005.

Keep reading... Show less

Rockefeller Foundation commits $1 billion for COVID-19 recovery

The Rockefeller Foundation announced on Monday that it will allocate $1 billion over the next three years to address the pandemic and its aftermath.

Why it matters: The mishandled pandemic and the effects of climate change threaten to reverse global progress and push more than 100 million people into poverty around the world. Governments and big NGOs need to ensure that the COVID-19 recovery reaches everyone who needs it.

Keep reading... Show less

How Amy Coney Barrett will make an immediate impact on the Supreme Court

In her first week on the job,Amy Coney Barrett may be deciding which votes to count in the presidential election. By her third week, she’ll be deciding the fate of the Affordable Care Act.

Where it stands: The Senate votes on Barrett’s nomination tomorrow. If she’s confirmed, Chief Justice John Roberts is expected to swear her in at the Supreme Court within hours, an administration official tells Axios.

Keep reading... Show less

Insights

mail-copy

Get Goodhumans in your inbox

Most Read

More Stories