US Edition
Tariffs Aren't Answer to Imbalances: IMF
GLOBAL ECONOMY, JUL 22 – The IMF warns rising global imbalances in 2024 stem from excess surpluses and deficits in the US, China, and euro area, urging domestic policy fixes over tariffs.
- The International Monetary Fund published its 2025 External Sector Report analyzing economic disparities among the world’s 30 biggest economies, highlighting a notable increase in global current account differences throughout 2024.
- This widening reverses a decade-long narrowing trend and stems mainly from increased excess balances in the US, China, and the euro area, fueled by domestic macroeconomic distortions.
- The report criticized US President Donald Trump's tariffs, stating they had little effect on imbalances since tariffs reduce both investment and savings, but warned that escalating trade tensions risk harming global financial stability.
- IMF chief economist Pierre-Olivier Gourinchas warned that swift and substantial growth in international economic imbalances can lead to considerable harmful effects between countries, and stressed that solutions should focus on adjusting domestic economic policies rather than imposing tariffs.
- The report noted risks from the depreciation of the Chinese yuan and US dollar which may widen China's surpluses, and forecast global imbalances likely to narrow again only with coordinated domestic adjustments and fiscal restraint.
19 Articles
19 Articles
Tariffs aren't answer to imbalances: IMF
Global current account balances widened sharply in 2024, reversing a narrowing under way since the global financial crisis of 2008-2009, the International Monetary Fund (IMF) said on Tuesday, warning that tariffs were not the answer. In its annual External Sector Report, which assesses imbalances in the 30 largest economies, the IMF noted that external surpluses or deficits were not necessarily a problem but could cause risks if they became exce…
In the world we must always keep an eye on the IMF, and this time it is no exception.According to the original report published by Reuters and written by Andrea Shalal, the International Monetary Fund (IMF) has hired the cameras to illuminate one of the major current economic problems: global current account balances expanded considerably in 2024. They tell us bluntly that, although external deficits and surpluses are not always a problem, they …
The gap between the trade imbalances of the big economies widened in 2024, which is a shift from the contraction observed since the global financial crisis. This is revealed by the International Monetary Fund (IMF) in its External Sector Report 2025 (ESR) published on Tuesday. The Washington-based institution prescribes “a concerted adjustment” of domestic macroeconomic policies. But, in a message to US President Donald Trump, warns that an incr…
Colorado Springs Gazette
IMF warns tariffs aren't the answer to global imbalances
By Andrea Shalal
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