Abstract Rising trade tensions, a spate of trade-inhibiting policy measures and a weakening of multilateral institutions have sparked a growing concern about the potential implications of global trade fragmentation. Yet, empirical evidence that geopolitical considerations are already materially affecting trade flows is scant. In this study, we quantify the impact of geopolitical tensions on trade of manufacturing goods over the period 2012-2022 in a structural gravity framework. To capture the influence of geopolitical tensions, we use a measure of...

Campaigning across Europe ahead of this year’s European elections was a reminder of what makes our Union what it is. Almost 500 million people with such disparate cultures, complex histories and differing perspectives all coming together at the same time to articulate their wish for an entire Union of 27 countries. In casting their vote they also help to build a shared European identity – all of this bound together by our rich and varied cultural tapestry. This is...

Blog post by Svetla Daskalova, Federico Maria Ferrara, Pedro Formoso da Silva, Pamina Karl and Thomas Vlassopoulos | Repo markets are vital for banks to source liquidity and securities. They also represent an essential link in the monetary policy transmission chain. While the Eurosystem is in the process of reducing its market footprint, repo markets are going through a phase of change. The ECB Blog looks at dynamics in this market. Monetary policy and repo markets are closely connected. The...

Long periods of slow economic growth can cause a jump in inequality. But a balanced set of policies can stave off that outcome. Blog post by Kristalina Georgieva, Managing Director of the IMF | The global economy is stuck in low gear, which could deal a major blow to the fight against poverty and inequality. Group of Twenty finance ministers and central-bank governors gathering this week in Rio de Janeiro face a sobering outlook. As the IMF’s latest World Economic Outlook update shows,...

The Organisation for Economic Co-operation and Development (OECD) announced a pilot phase to monitor the application of the Hiroshima Process International Code of Conduct for Organisations Developing Advanced AI Systems. This initiative will test a reporting framework intended to gather information about how organisations developing advanced artificial intelligence (AI) systems align with the Actions of the Code of Conduct and is a significant milestone under the G7's ongoing commitment to promoting safe, secure and trustworthy development, deployment and use of...

Thank you very much, dear Roberta, Good afternoon to everyone, I guess you have heard my speech, and you might have read the Political Guidelines. So you can imagine that this is a very emotional and special moment for me now. I just want to make three very short remarks before moving on to your questions. The first one is a more personal remark. I cannot begin without expressing how grateful I am for the trust and the confidence of the majority...

Reforms could increase investment in high-tech startups that power innovation Blog post by Nathaniel Arnold, Guillaume Claveres, Jan Frie | The European Union has a productivity problem. Its people produce nearly 30 percent less per hour worked than they would have, had real output per hour worked increased in line with that in the United States since 2000. A failure to sufficiently develop innovative startups into “superstar” firms is one of the reasons for the bloc’s poor productivity growth. Europe’s fragmented economy and financial system...

Blog post by Pierre-Olivier Gourinchas | Our global growth projections are unchanged at 3.2 percent this year and slightly higher at 3.3 percent for next year, but there have been notable developments beneath the surface since the April World Economic Outlook. Growth in major advanced economies is becoming more aligned as output gaps are closing. The United States shows increasing signs of cooling, especially in the labor market, after a strong 2023. The euro area, meanwhile, is poised to pick...