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Higher debt can potentially reduce the ability of governments to react to the COVID-19 crisis. Our data show that the global average debt-to-GDP ratio (weighted by each country’s GDP in US dollars) rose to 226 percent in 2019, 1.5 percentage points higher than in 2018. Most of the increase came from higher public debt in emerging market economies and advanced economies outside of Europe. In low-income countries, total debt rose by 1.3 percentage points of GDP in 2019—mostly driven, in contrast, by higher private debt. Image: IMF As shown in our chart of the week, a dive ...

Home Investors also need to ‘act big’ as Yellen signals regime change Investors also need to ‘act big’ as Yellen signals regime change Expansive fiscal and monetary policies may see 1980s-style Japanese melt-up and meltdown World Economy News The writer is co-founder and chief investment strategist at Absolute Strategy Research Regime changes are hard to spot — they only occur every 20 years or so and often slowly, rather than in a single moment. However, financial historians may look back to January 19, 2021 as a key date. This was when Janet Yellen announced at...

Many countries entered the pandemic with elevated debt levels. Our new update of the IMF’s Global Debt Database shows that global debt - public plus private - reached $197 trillion in 2019, up by $9 trillion from the previous year. This substantial debt created challenges for countries that faced a debt surge in 2020, as economic activity collapsed and governments acted swiftly to provide support during the pandemic. Higher debt can potentially reduce the ability of governments to react to the COVID-19 crisis. Our data show that the global average debt-to-GDP ratio (weighted by each country...