International and Monetary Economics Network

Dear friends of the International and Monetary Economics Network

Our network is growing fast. In 2026, we will further expand our activities and contributions to debates on international economics, monetary policy, and related topics.

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In our webinars and in-person events, members of the network or guests are invited to present. Interested persons can contact us.

Webinar: EU Industrial Policy in a Fracturing Global Economy (Peter Obinger, Austrian Federal Economic Chamber)

• March 5, 12:00 – 13:00 Central European Time
• Online via Zoom
• In English

Industrial policy is back in fashion. In recent years, European countries have increasingly turned to industrial policy against the backdrop of geopolitical fragmentation, supply chain risks, or the green transition. Well-targeted industrial policy has the potential to correct market failures and bring about benefits. At the same time, even carefully designed industrial policies risk generating negative production externalities in other countries and may not be welfare-enhancing for the implementing country.

Peter Obinger is an economist at the Economic Policy Department of the Austrian Federal Economic Chamber, where he specialises in industrial and energy policy. He also serves as an editor for “Wirtschaftspolitische Blätter” one of Austria’s largest applied economic policy journals.

REGISTRATION HERE

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Call for Contributions: IMEN Critical Materials Observatory – In 2026, we will focus on developments in critical materials markets in relation to geopolitics, international trade, inflation, and the economy in general. We warmly encourage everyone to contact us with suggestions. Webinar presentations, guest posts, anecdotes, or any other valuable inputs are welcome.


Call for Contributions: IMENAI Global Economy Observatory– In 2026, we will focus on the impact of artificial intelligence on labor markets, productivity, international trade, monetary policy, and the economy in general. We warmly encourage everyone to contact us with suggestions. Webinar presentations, guest posts, anecdotes, or any other valuable inputs are welcome.

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Here is what caught our eye (selection): Turbulent times for the Fed, global economy update, macroeconomic effects of tariffs, and much more…


Turbulent Times for the Fed!

US prosecutors launch criminal investigation into Federal Reserve’s Jay Powell: Chair says probe follows central bank’s refusal to bow to White House push for much lower interest rates

“…the investigation is likely to be taken as a warning shot to whoever Trump picks to succeed him in the role of the world’s most important central banker. An announcement is expected later this month. Allies of the president may also have decided to act now to force Powell to step down as a Fed board governor later this year.”


It’s high time to look at interesting analyses like this one!

“Why central bank independence matters – lessons from the past 50 years“ by Alexander Jung.

“Are independent central banks better at ensuring price stability? A study of 155 central banks over 50 years shows why independence makes a difference. Central banks that are shielded from government control are able to pursue more credible monetary policies and are therefore better at keeping prices stable.”

ECB blog post

Associated working paper: “Do Central Bank Reforms Lead to More Monetary Discipline?“ by Alexander Jung, Davide Romelli, and Etienne Farvaque.

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The German economy is widely expected to grow again in 2026. But by how much? In our recent poll onsocial mediaandSubstack, a majority of IMEN community members expect a GDP growth rate between 0.8 and 1.2 percent.

In the past weeks, there were several encouraging economic data published by the statistical agency Destatis. For instance, German factory orders jumped in November. New orders in the manufacturing industry increased by 5.4 percent in November (compared to October, seasonally adjusted). Large orders in the defense sector appear to play an important role. This is positive news for the German economy and is widely interpreted as a positive surprise by economists. However, the German economy still faces several challenges.

Claus Vistesen, chief euro zone economist at Pantheon Macroeconomics, sayshere:
“Factory orders are on track for a sizeable gain over the fourth quarter as a whole…”
“Overall, these are strong data, though major orders tend to mean-revert in the following month, creating downside risk for the headline (figure) in December,”

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Global Economy Flash: Seemingly resilient amid headwinds, yet fragile

• Global GDP growth remains solid. Global trade has proven more resilient than expected. However, higher tariffs and rising protectionism will weigh on global growth and trade in 2026 and 2027.
• We expect global economic output to increase by 2.9 percent in 2026. For 2027, we currently anticipate a slight acceleration to 3.1 percent.
• The US economy benefits from the AI boom, but the rest of the economy is less strong. US households benefit from the easing of fiscal and monetary policies. Inflation remains too high and we should worry about the independence of the Fed.
• The Chinese economy depends on exports, but domestic demand continues to struggle.
• The Euro area remains on a solid growth path despite structural challenges and high debt in some countries. The German fiscal stimulus will gradually lift growth in Germany and also spill over to other European countries.
• Monetary and fiscal policy: Mostly expansionary fiscal policy and monetary policy is becoming increasingly divergent.
• The Swiss economy remains resilient with modest growth rates. The pharmaceutical sector will be less of a growth driver than in the past.
• Many (mostly downside) risks, among them: Conflicts and geopolitical tensions have the potential to escalate, supply chains for critical raw materials are fragile, the AI boom could end abruptly, and potential public debt crises.

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Highly recommended!

“The Macroeconomic Effects of Tariffs: Evidence From U.S. Historical Data“ by Tamar den Besten and Diego R. Känzig.

“We study the macroeconomic effects of tariff policy using U.S. historical data from 1840–2024. We construct a narrative series of plausibly exogenous tariff changes – based on major legislative actions, multilateral negotiations, and temporary surcharges – and use it as an instrument to identify a structural tariff shock. Tariff increases are consistently contractionary: imports fall sharply, exports decline with a lag, and output and manufacturing activity drop persistently. The shock transmits through both supply and demand channels. Prices rise in the full sample but fall post-WWII, a pattern consistent with changes in the monetary policy response and with stronger international retaliation and reciprocity in the modern trade regime.”

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This sounds super interesting!

2 Post-Doctoral Positions in Monetary Economics(University of Bern)

“The goal of the project is to study the structure and the stability of the future digital financial system. The candidate is expected to work independently on projects in this area, but also to contribute to developing and calibrating models with the project leaders.” (The project leaders are Lukas Altermatt and Cyril Monnet.)

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Super interesting!

“How Monetary Policy Is Made: Lessons from Historical FOMC Discussions“ by Cooper Howes,Marc Dordal i Carreras, Olivier Coibion, and Yuriy Gorodnichenko.

“We construct a new dataset of FOMC meeting transcripts from 1966 to 1990 to analyze the sources of heterogeneity in individual monetary policy preferences and study how this heterogeneity shapes policy decisions. Using these detailed discussions, we manually quantify and characterize each FOMC participants’ preferred policies along with their reasoning and justification. We show that participants’ beliefs about the effects of monetary policy—specifically, their perceived slope of the Phillips Curve—play a central role. Participants who believe monetary policy has stronger effects on real activity are more likely to cite output as a justification for easing, while those perceiving stronger price effects emphasize inflation as a reason for tightening. We then show that the Chair plays a unique and powerful role in reconciling these views, not just in setting policy rates, but also in minimizing dissent.”

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Super interesting!

“Why Care About Debt-to-GDP?“ by Jonathan B. Berk and Jules H. van Binsbergen.

“We construct an international panel data set comprising three distinct yet plausible measures of government indebtedness: the debt-to-GDP, the interest-to-GDP, and the debt-to-equity ratios. Our analysis reveals that these measures yield differing conclusions about recent trends in government indebtedness. While the debt-to-GDP ratio has reached historically high levels, the other two indicators show either no clear trend or a declining pattern over recent decades. We argue for the development of stronger theoretical foundations for the measures employed in the literature, suggesting that, without such grounding, assertions about debt (un)sustainability may be premature.”

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Very valuable!

“Benjamin Golub on Modern AI for Economics Research: An Overview of Tools“ (Markus’ Academy organized by Markus Brunnermeier).

By the way, the toolrefine.ink(co-founded by Ben Golub) is really cool! “Refine helps you check your paper before submission and avoid the kinds of avoidable mistakes that cause stress and lost time later.”

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Highly relevant!

“Monetary policy decision-making and communication under high uncertainty,” edited by Eduardo Amaral, Fernando Avalos, and Ilhyock Shim.

“This volume provides a comprehensive view of how central banks have navigated uncertainty in recent times. Drawing on both survey-based evidence and in-depth case studies from 10 individual central banks, the chapters explore the evolving role of scenario analysis, the integration of high-frequency data and expert judgment, and the increasing importance of transparent and adaptive communication.”

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“Thank you, Richard Baldwin: A founder’s legacy and VoxEU’s next chapter” by Beatrice Weder di Mauro.
“VoxEU launched in June 2007 with a simple but ambitious idea: that rigorous economics could speak clearly, quickly, and accessibly to the world’s most urgent policy debates. As its founding Editor-in-Chief Richard Baldwin steps down, this column marks this moment with thanks for his vision, his energy, and his service to the economics profession and to the public.”

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Fifth Conference on the International Roles of the U.S. Dollar – Call for Papers, June 22–23, 2026, Federal Reserve Board, Washington, D.C.
“This year’s conference will center on understanding the implications of financial innovations, especially digital assets including stablecoins, for the international roles of the U.S. dollar.”

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We are always open to collaborations. Please feel free to contact us.