2021 Comprehensive Surveillance Review— Background Paper on The Surveillance Priority Preempting and Mitigating Spillovers

Abstract

causing their economic situation to deteriorate and potentially take policy actions in reaction to the spillover that lead to adverse feedback effec ts (“spillbacks”) on the source country. focus on inward spillovers in IV consultations. spillover work via range of surveillance in Article IV consultations. understand and more consistent coverage of outward spillovers in surveillance, through with member The 2019 IEO’s review of Fund work in unconventional monetary policy (Independent Evaluation Office 2019) conclusions, strengthen work on cross-border spillovers, including analyzing further how finetuning the policy mix in source countries can alleviate adverse spillovers on recipient countries. recommended to make sure Fund is at the forefront of financial spillover analysis and provision of advice on dealing with capital flows, drawing on its global multilateral mandate, universal membership, and breadth of country experience. spending shocks, and among countries with fixed exchange rates. from the U.S. oil and gas sector becoming a global shock absorber, and spillovers from U.S. fiscal and monetary policy. The RAM discussed potential inward spillovers, including from a significant China slowdown and a disorderly Brexit.