emerging markets

Here in Washington, rather low-key International Monetary Fund/World Bank spring meetings are getting underway. The Group of 20 is likely to have another squabble and then paper over the cracks with lots of effort spent in talking about measuring trade imbalances rather than doing anything about them. But the April 2011 Fund World Economic Outlook is rather good. I will bring you some of the more interesting themes here to supplement the news we published yesterday. First out of the traps is the Fund’s real concern about overheating in emerging economies.

The IMF points out that most emerging markets have exceeded the level of output from the pre-crisis peak and have rising levels of headline and core inflation, “suggesting that inflation pressure is broadening”.

“The issue is whether they [emerging economies] are experiencing the kind of credit boom that inevitably ends with a bust. Evidence is not reassuring in this regard”.

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