Amid heightened uncertainty, policymakers will need to deal with complex trade-offs between debt, slower growth, and new spending pressures
Risks have risen as financial conditions tightened, with key vulnerabilities ahead
Amid trade tensions and high policy uncertainty, the path forward will be determined by how challenges are confronted and opportunities embraced
Public approval is crucial for carrying out difficult reforms that can help countries lower debt and increase growth
When destination countries tighten migration and refugee policies, it has economic ripple effects elsewhere
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Combining overhauls in areas including business and external regulation, governance, and human development can boost output levels by 3 percent over four years.
Simulations that incorporate machine learning-based predictions of conflict suggest large payoffs from preventive policies, including efforts to promote macroeconomic stability and growth
Growth divergences persist and could widen, while policy shifts may reignite inflation pressures in some countries
Some countries risk missing out on the full economic benefits of AI, but more formal jobs and expanded digital access can help
Heightened tensions can hurt stock markets, raise government borrowing costs, and pose risks to financial stability
Increased investor risk-taking could fuel vulnerabilities
Unknowns raise risk of financial market volatility and a sharp decline in economic growth
Currencies have depreciated to varying degrees in emerging market economies as interest rate differentials with the United States narrowed
The decline of inflation could be stalling in some economies
The increase in debt in the last decade points to the need for lowering deficits, rebuilding space to deal with shocks, and strengthening fiscal rules
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Large fiscal deficits and elevated debt levels call for greater fiscal prudence, but political forces are pulling in the opposite way
Governments should stay the course on fiscal consolidation amid mounting debt.
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AI may widen inequality, but policymakers can counteract this with more effective social safety nets, reskilling programs, and regulations to promote ethical use of the technology
AI-driven trading could lead to faster and more efficient markets, but also higher trading volumes and greater volatility in times of stress
New AI Preparedness Index Dashboard tracks 174 economies based on their digital infrastructure, human capital, labor policies, innovation, integration and regulation
