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Although Europe in the aggregate is a not a major contributor to global current account imbalances, its trade and financial linkages with the rest of the world mean that it will still be affected by a shift in the current configuration of external deficits and surpluses. We assess the macroeconomic impact on Europe of global current account adjustment under alternative scenarios, emphasizing both trade and financial channels. Finally, we consider heterogeneous exposure across individual European economies to external adjustment shocks.

Exports and Imports --- Current Account Adjustment --- Short-term Capital Movements --- International Investment --- Long-term Capital Movements --- International economics --- External position --- Current account balance --- Foreign assets --- Current account --- Current account deficits --- Balance of payments --- International finance --- Investments, Foreign --- United States

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The Selected Issues paper on Jordan analyzes the Jordanian dinar, which has historically operated within a fixed exchange rate regime. The deterioration in 2004 and 2005 reflected an exceptionally rapid increase in imports, as the saving-investment balance shifted. Following an improvement in 2006, the current account again deteriorated in 2007 from a negative impact of international food and fuel prices. Import developments have been the single most important determinant of swings in the current account, followed to a lesser extent by the impact of exports and grants.

Exports and Imports --- Foreign Exchange --- Current Account Adjustment --- Short-term Capital Movements --- Trade: General --- International economics --- Currency --- Foreign exchange --- Current account --- Real effective exchange rates --- Current account deficits --- Imports --- Current account balance --- Balance of payments --- International trade --- Jordan

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Recent indicators suggest that activity in the world economy is strengthening more rapidly than projected by the staff six months ago. This is especially true of the United States, but the staff has also revised upward its growth projections for most other industrial countries-in the case of Japan and several of the smaller industrial countries by significant amounts.

International Economic Integration --- Political Science --- Exports and Imports --- Inflation --- Trade: General --- Current Account Adjustment --- Short-term Capital Movements --- Price Level --- Deflation --- International economics --- Macroeconomics --- Imports --- Current account deficits --- Exports --- Current account --- International trade --- Prices --- Balance of payments --- United States

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Following the breakup of the Soviet Union in 1992, several low-income countries in the Commonwealth of Independent States (CIS) accumulated substantial external debt in a short time span, about half of which is owed to multilateral financial institutions. Three factors contributed to the current debt burden. First, the initial years of transition brought large systemic economic disruptions, loss of transfers from the center and collapse of trade relations among Council for Mutual Economic Assistance (CMEA) countries, and negative terms of trade shocks. Second, fiscal and other reforms, and consequently, growth revival, took longer than expected. Third, overoptimism by multilaterals contributed to the high debt levels. If external financial assistance, which was needed because of high social costs of the transition, had come in the form of grants in the first two or three years of the transition, the debt burden would have been lower and sustainable.

Debts, External --- Debts, External. --- Debts, Foreign --- Debts, International --- External debts --- Foreign debts --- International debts --- Debt --- International finance --- Investments, Foreign --- Exports and Imports --- Current Account Adjustment --- Short-term Capital Movements --- International Lending and Debt Problems --- International economics --- External debt --- Current account deficits --- Current account balance --- Current account --- Current account imbalances --- Balance of payments --- United States

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This paper compares the evolution of the Australian current account balance over the period 1954–94 against an optimal current account derived from a consumption-smoothing model. The findings indicate that the Australian current account was not used to smooth consumption optimally in the period prior to the relaxation of capital controls in the early 1980s. The results also suggest that in the period since the mid-1980s Australia’s current account deficits have become excessive, and that the increase in national saving required to satisfy its external borrowing constraint is about 2 to 4 percent of GDP.

Exports and Imports --- Macroeconomics --- Current Account Adjustment --- Short-term Capital Movements --- Open Economy Macroeconomics --- Macroeconomic Aspects of International Trade and Finance: Forecasting and Simulation --- Macroeconomics: Consumption --- Saving --- Wealth --- International Investment --- Long-term Capital Movements --- International economics --- Current account --- Current account deficits --- Current account balance --- Consumption --- Foreign liabilities --- Balance of payments --- National accounts --- External position --- Economics --- Investments, Foreign --- Australia