UNITED STATES, WASHINGTON (OBSERVATORY) — According to the IMF, the level of concern was 10 times higher than the peak values of previous decades.
And this, according to estimates by the fund’s experts, could lead to a decrease in global economic growth by about 0.75% this year.
According to Bloomberg, the IMF has launched a new index reflecting a quantitative assessment of trade uncertainty. The index is based on reports from the Economist Intelligence Unit since 1996. The methodology for calculating it is similar to that used to calculate the IMF’s own World Uncertainty Index.
To calculate the new indicator, IMF researchers calculate how often the word “uncertainty” appears in EIU reports alongside terms such as “tariffs,” “protectionism,” or “trading.”
The IMF notes that concerns about a trade war between the US and China have most affected countries in America and the Asia-Pacific region.
According to the IMF, after 20 years of stability, the global trade uncertainty index began to grow around the third quarter of last year, which coincided with tariff measures by the United States and China. The fund notes that after a short respite, the index grew in the first quarter of 2019, which reflects a significant increase in US tariffs on Chinese imports from March 1.
While trade uncertainty generally increased around the world, this growth was much higher for advanced economies. According to the IMF, it remained “moderately low” in the Middle East, Central Asia and Africa.
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