The Evolution of International Financial Integration

The IMF has published a working paper on International Financial Integration in the Aftermath of the Global Financial Crisis. The main findings are:

  1. The rapid growth in cross border positions in relation to GDP pre-2008, has effectively come to a halt.
  2. There are weaker capital flows to and from advanced economies as cross border banking activity continues to fall.
  3. Less-financially-integrated emerging and developing economies continue to increase their share of global GDP.
  4. The retrenchment in cross-border banking activity relative to pre-2008 trends, has been offset by increasing FDI positions. This may be indicative of growing claims on and from international financial centers, where pass-through financial vehicles and shifting domiciles of multinational corporations play a major role.

Link: http://www.imf.org/en/Publications/WP/Issues/2017/05/10/International-Financial-Integration-in-the-Aftermath-of-the-Global-Financial-Crisis-44906

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