Only six months ago, a “soft landing” appeared to be in sight: the global economy was stabilizing after an extraordinary string of calamities both natural and man-made over the past few years. That moment has passed. The world economy today is once more running into turbulence. Without a swift course correction, the harm to living standards […]
In 2025, the US government announced a series of tariff increases targeting major trading partners, including Canada, China, and Mexico. This column estimates the economic consequences of these proposed tariffs to the US and globally. According to this model, real wages in the US decline by 1.4% in 2028 and GDP falls by approximately 1%, […]
In June 2016, Donald Trump justified the protectionist policies during his first administration as “the quickest way to bring our jobs back to our country”. This column shows that while the trade war with China failed to create jobs at home, it did boost employment in Brazil. Regions in the country specialised in industries targeted […]
Recent evolutions in US attitudes and policies have raised questions about the future of the dollar’s role in the global economy. This column explores a hypothetical scenario in which the world is deprived of the dollar as its global safe asset. In such a world, interest rates would be higher and more volatile. Liquidity would […]
There has been renewed interest in industrial policy as a tool to reshape the structure of economic activity, but little evidence exists on the successful design and implementation of these policies. This column examines the transformation of East Germany’s state-controlled economy after the collapse of socialism and draws valuable lessons from the experience for contemporary […]
The Phillips curve describes the relationship between inflation and real economic activity over the business cycle. This column challenges the notion that the Phillips curve is flat. Using pre-pandemic Belgian micro data, it shows that inflation responds to variations in production costs but is insensitive to variations in output. The flatness of the conventional output-gap […]
Cities are engines of economic growth and job creation, and their future pathways will shape global development outcomes for decades to come. But the success of this transformation depends on making the right investments now—investments that strengthen essential infrastructure, unlock new jobs, and build cities that are more sustainable and resilient. The charts below visualize […]
The global economy is facing heightened uncertainty, clouding economic forecasts. In our recently launched April 2025 Middle East and North Africa Economic Update , we report that growth in MENA averaged a modest 1.9% in 2024 and is forecast to accelerate moderately to 2.6% in 2025. But growth forecasts for countries across the region are shadowed in […]
Tariffs disrupt trade flows and influence prices, but their broader impact depends on how they are structured and the type of goods targeted. This column examines the economic implications of tariffs across the supply chain, with a particular focus on how different modes of retaliation to US tariffs impact economic activity, inflation, and trade. The […]
Despite signs of cautious improvement, India-China relations remain deeply strained by border tensions and mutual distrust. China-India relations, which have long been fraught, were further complicated by the 2020 military standoff on the Himalayan border. The political disruption had a significant impact on Chinese companies’ presence in India. And yet, India’s dependence on Chinese imports […]
