14 Must See Charts From The Epic IMF Report On The State Of The World Economy

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The IMF just released its bi-annual report on the state of the global financial system. It highlights the improvements made towards greater global financial stability over the last 6 months, but also suggests several threats that could inhibit continued improvement.One major focus in continued tensions in the Middle East, which have impacted oil prices, and threatened global economic stability. Another is the slow, difficult progress of removing support measures supplied by countries during the financial crisis, while ensuring banks remain economically stable at the same time. Further, the threat of further sovereign crises is mooted, implying that many of the risks once found at banks are now on the balance sheets of the world’s governments.

While the entire 197 page report is worth a read, we’ve pulled out the most important charts of the report you need to see to understand the IMF’s underlying findings.

Sovereign credit risks are on the rise.

Risk appetite is up everywhere but the emerging markets.

Monetary policy is actually getting easier, not tighter.

Urban real estate prices are rising in London and Singapore.

Overall, Asian real estate price growth has slowed.

In the U.S., the shadow housing inventory remains a deflationary drag on the economy.

All that real estate debt has a sharp impact on Western household leverage ratios.

Consumers in debt are also being pinched by rising oil prices and overall inflation.

US banks have limited exposure to markets in the Middle East, but UK and French banks have some cause for concern.

And while US bank balance sheets have seen sharp improvement since the crisis, Europe's still remain weak.

And a large per cent of those European banks face rollover risk in 2011 and 2012.

Japan has the largest funding need in 2011, while Greece and the US are further behind.

Both Japan and the US face serious sovereign risks if their interest rates increase.

Increasing interest rates in the US or Japan would make debt repayment costs much higher, rising to 20% of GDP in the green scenario.

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