There are two main forces behind the large U.S. current account deficits. First, an increase in the U.S. demand for foreign goods. Second, an increase in the foreign demand for U.S. assets. Both forces have contributed to steadily increasing current account deficits since the mid--1990s. This...

There are two main forces behind the large U.S. current account deficits. First, an increase in the U.S. demand for foreign goods. Second, an increase in the foreign demand for U.S. assets. Both forces have contributed to steadily increasing current account deficits since the mid-1990s. This...

After the recent crisis, a reduction was observed in global current account (“flow”) imbalances. Even so, global disequilibria as measured in terms of countries' net foreign assets (“stock imbalances”) kept increasing. This paper discusses whether stock imbalances have a stabilising or...

This paper aims to identify how much of the recent current account adjustment in Spain can be explained by cyclical factors. For this purpose, we consider the cross-country regressions in the IMF's External Balance Assessment (EBA) methodology but allowing for country-specific slopes and...

Current account imbalances and their sustainability are among the most debated international policy issues. Through the recently designed External Balance Assessment methodology (EBA), the IMF estimates the impact of several countries' fundamentals and policies on their current account balance,...

After the recent crisis, a reduction was observed in global current account (flow imbalances). Still, global disequilibria as measured in terms of countries' net foreign assets (stock imbalances), kept increasing. This paper studies whether stock imbalances have a stabilizing or destabilizing...