Developing countries should not be tempted to stimulate their economies this year in the face of weak growth, the World Bank warned on Wednesday even though the world faces another challenging year.
In forecasts that suggest 2013 will see only marginally stronger growth than last year, the Bank recommends that poor and middle-income countries concentrate on fundamental drivers of prosperity rather than attempt a quick fix.
The week ahead in central banking
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IMF/ World Bank meetings
Many of the world’s top central bankers will travel to Tokyo this week for the IMF/ World Bank annual meetings. The meetings take place on Friday and Saturday.
Details of the meetings and the full programme of seminars is available here. Highlights include a talk by Zhou Xiaochuan, governor of the People’s Bank of China, on Sunday at 11:30 a.m Tokyo time (2.30am GMT), and appearances by Fed chair Ben Bernanke and ECB president Mario Draghi at a BoJ/IMF event later in the day. Read more
World Bank idol
Obama’s World Bank nominee Jim Yong Kim is a man of many talents…
http://www.youtube.com/watch?v=4lHKJEp5e-8 (Mr Kim’s attempt to be the next Kelly Clarkson begins two minutes in). Read more
The week ahead in central banking
Our week ahead email will help you to track the most important events in the central banking world. To see all of our emails and alerts visit www.ft.com/nbe
The majority of the world’s central bank governors and finance ministers are in Washington, DC this weekend for the IMF/ World Bank Annual Meetings.
Will there be any more policy coordination following the G-20 communiqué released late Thursday? Read more
The week ahead in central banking
FOMC speak
Three Federal Open Market Committee members give their take on the US economic outlook following Tuesday’s pledge to keep rates at record lows for almost another two years.
William Dudley, the New York Fed president and the only voting member of the three, offers his thoughts on Thursday. He follows the Atlanta Fed’s Dennis Lockhart, who is set to talk on the US economy on Monday at 17.00 GMT. This post, from the Atlanta Fed’s research director Dave Altig and economist Mike Bryan, signals that Mr Lockhart is likely to be in the wait-and-see camp on QE3. The Cleveland Fed’s Sandra Pianalto covers the evolving financial services industry along with the economic outlook when she speaks on Friday at 17.45 GMT. Read more
Cash in the Bank
It’s often the fate of the World Bank to be overshadowed at the spring meetings, since its sibling, the IMF, is generally in the thick of a faster-moving story (Greece, currencies, bank taxes, etc).
But in a weekend when the IMF basically avoided discussing all the big questions, the bank actually made some real concrete progress: it secured the $5.1bn capital increase that its president Robert Zoellick has been seeking for the best part of a year. So, like the IMF with its tripled firepower, the bank is having a shot at keeping up with the growth in the global economy. Read more
Don’t mention the yuan
We generally call it the renminbi round here, but yuan gives a better headline. Just come out of a briefing from the UK’s Alistair Darling, taking a break from the general election campaign (for those taking notes, he’s got a majority of 7,242, not the safest seat in the world but not a marginal).
Darling had just stepped out of the IMF ministerial committee meeting in which, he informed us when I asked him, the words “yuan” and “renminbi” were never uttered. Apparently they discussed global economic imbalancing in somewhat broader terms. And the 800-pound panda in the corner of the room went ignored. Read more
Leading by example on bank levies, and other G20 stories.
A communique that more or less acknowledged disagreement over the great bank taxes debate and a Canadian finance minister, Jim Flaherty, thinking that the debate was swinging Canada’s (anti-bank levy, pro-contingent capital) way. I think one of two things could happen at this point:
1. The US and Europeans who support the bank tax will keep pushing it at G20 level, perhaps soft-pedalling until after the Canadian-hosted G7/G20 summit in June and then resuming the campaign in the second half of the year.
2. As Secretary Geithner suggested tonight, the US might just forge ahead anyway and hope that the rest of the world follows behind once they see what a great idea it is. My notes (not precise quote) say: “We are going to move in the US and I suspect you will find when other countries see what we do, they are going to take similar measures”.
Not entirely sure that 2. is a sustainable option, since other countries might well think it is worth taking the risk of funding a bank bailout down the line to steal business from American and European banks now. Then again, Canadian banks aren’t particularly known for buccaneering adventurism in other developed country markets (some are quite big in emerging markets), so perhaps they are an exception that can be tolerated without too much risk of being undercut. Japan, on the other hand, another opponent of bank taxes, could be a different matter. Read more
The 53m hardest hit by the economic crisis
Who has the crisis hit hardest?
The 53m people (close to the population of the UK) who will remain in extreme poverty by 2015 who would not have had there not been a crisis.
And that wasn’t the grimmest of the World Bank-IMF Global Monitoring report.
“Although the recovery is underway the negative impact will be lasting,” said Delfin Go, World Bank lead economist, at a press conference.
Among the other impacts of the crisis:
Spring meetings open in multipolar world
We have moved “way beyond a North-South world” and the World Bank is moving with it.
The message, from Robert Zoellick, World Bank president, came as he called for shareholders to expand developing countries votes at the institution at the opening of the WB/IMF spring meetings. Read more
| About this blog | Blog guide |
Chris Giles has been the economics editor of the Financial Times since 2004. Based in London, he writes about international economic trends and the British economy. Before reporting economics for the Financial Times, he wrote editorials for the paper, reported for the BBC, worked as a regulator of the broadcasting industry and undertook research for the Institute for Fiscal Studies. RSS
Michael Steen, Frankfurt bureau chief, covers the ECB and the eurozone's economies. He joined the Financial Times in 2007 as Amsterdam correspondent and later worked as a front page news editor in London. Before joining the FT, he spent nine years as a correspondent at Reuters, mostly in foreign postings that included a previous stint in Frankfurt, as well as Moscow, Kiev and central Asia. He read German and Russian at Cambridge.RSS
Robin Harding is the FT's US economics editor, based in Washington. Prior to this, he was based in Tokyo, covering the Bank of Japan and Japan's technology sector, and in London as an economics leader writer. Robin studied economics at Cambridge and has a masters in economics from Hitotsubashi University, where he was a Monbusho scholar. Before joining the FT, Robin worked in asset management and banking. RSS
Ralph Atkins, capital markets editor, has been writing for the Financial Times for more than 20 years following an economics degree from Cambridge. From 2004 to 2012, Ralph was Frankfurt bureau chief, watching the European Central Bank and eurozone economies. He has also worked in Bonn, Berlin, Jerusalem and Brussels. RSS
Claire Jones is Money Supply economics team writer, based in London. Before joining the Financial Times, she was the editor of the Central Banking journal and CentralBanking.com. Claire studied philosophy and economics at the London School of Economics. RSS
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