After the decline in oil prices, many oil exporters face the need to improve their externalbalances. Special characteristics of oil exporters make the exchange rate an ineffectiveinstrument for this purpose and give fiscal policy a sizeable role. These conclusions aresupported by regression...

This paper studies the dynamics of net foreign liabilities across a number of countries. Our historical analysis suggests that an orderly reduction in a country's net foreign liabilities has mostly occurred when there was significant improvement in gross public savings through deliberate fiscal...

We study the process of external adjustment to large terms-of-trade level shifts-identified with a Markov-switching approach-for a large set of countries during the period 1960-2015. We find that adjustment to these shocks is relatively fast. Current accounts experience, on average, a...

The permanent income hypothesis implies that frictionless open economies with exhaustible natural resources should save abroad most of their resource windfalls and, therefore, feature current account surpluses. Resource-rich developing countries (RRDCs), on the other hand, face substantial...

The assessment of external positions and exchange rates is a key mandate of the IMF. This paperpresents the updated External Balance Assessment (EBA) framework-a key input in the conduct ofmultilaterally-consistent external sector assessments of 49 advanced and emerging marketeconomies-following...

A view receiving increased support is that the height of trade costs in prime export sectorshas a strong effect on current account balances: countries specializing in sectors that facerelatively high trade costs, such as services, tend to run current account deficits, andsimilarly, countries...

This paper explores the effect of news shocks on the current account and other macroeconomic variables using worldwide giant oil discoveries as a directly observable measure of news shocks about future output - the delay between a discovery and production is on average 4 to 6 years. We first...

The External Balance Assessment (EBA) methodology has been developed by the IMF's Research Department as a successor to the CGER methodology for assessing current accounts and exchange rates in a multilaterally consistent manner. Compared to other approaches, EBA emphasizes distinguishing...

The composition of Japan's current account balance has changed over time, with an increasing income balance primarily reflecting a growing net foreign asset position and higher corporate saving. A comparison of Japan's income balance with peer countries highlights: (i) relatively high yields on...