#monetarypolicy

Examining the Interplay of Monetary and Fiscal Policies in Latin America

A project examining the interaction of monetary and fiscal policies in Latin America deepens our understanding of the region

Latin American countries have wide-ranging experiences with economic policies and macroeconomic outcomes. The social and economic consequences have at times been adverse and dramatic. The Monetary and Fiscal History of Latin America project has produced systematic evidence using comparable datasets from these varied historical experiences to help build a knowledge base for the analysis of impacts […]

When Central Bank Autonomy Makes All the Difference

Central Bank autonomy can make all the difference for controlling inflation and providing macroeconomic stability

Since the late 1990s, a broad reform movement has swept Latin America, aimed at granting independence to central banks and freeing them from government pressure to print money to finance government spending. Laws have been passed and constitutions changed to allow independent central banks to focus on the fight against inflation. A more complicated case […]

Macroeconomic Challenges for Latin America and the Caribbean

Macroeconomic challenges loom for Latin America and the Caribbean despite its emergence from recession

As the October 2017 meetings in Washington wind down, the good news is that Latin America and the Caribbean is out of recession and set to grow at 1.2% this year. Only three countries (Suriname, Trinidad and Tobago and Venezuela—of the 26 borrowing IDB members) will post negative growth, as opposed to seven countries last […]

Searching for a New Macroprudential Framework

The policy of quantitative easing led by advanced economies and the subsequent surge of capital flows to emerging economies (EMEs) after the global financial crisis together with their recent reversal have highlighted the need to tailor a macro approach for EMEs that incorporates financial stability as an explicit policy target. But what should the approach […]

How to Adjust: 10 Priorities for Emerging Economies

Many emerging economies, particularly in Latin America and the Caribbean, are facing growing debt, fiscal deficits and low growth. Given the direction of debt-to-GDP ratios, many countries are choosing “adjustment” to maintain sustainability. In this blog, I offer 10 priorities that might guide a period of Considerate Consolidation. Priority 1: Speed. If output is at […]

Trade and Regional Integration: What We Don’t Have To Worry About

The policy recommendations of the IDB’s 2016 Macro Report Time to Act include deepening regional trade integration, a long-sought but still largely elusive goal. A casual observer may wonder why that goal matters. Even though the Free Trade Area of the Americas process failed to produce an agreement, Latin America and the Caribbean have fared […]

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