Global Imbalances and Policy Spillovers: A New Approach at the International Monetary Fund

Summary: The Peterson Institute hosted an event on September 18, 2012, to discuss a major shift in the International Monetary Fund's (IMF) framework for identifying exchange rate and financial policies in member countries that may have harmful implications for global stability or adverse economic effects on other countries. The leaders of the IMF team for this revised strategy--Sean Hagan, Tamim Bayoumi and Steven Phillips--presented the key elements of their work, as published recently by the IMF, the Pilot External Sector Report and underlying External Balance Assessment methodology. PIIE Senior Fellows Joseph E. Gagnon and John Williamson led off with separate remarks on the IMF framework.