Given high debt levels worldwide, we are also broadly supportive of the IMF’s comprehensive work agenda on debt issues. During the first phase of the pandemic shock, major central banks, including the ECB, took coordinated action to enhance the provision of US dollar liquidity.
As can be seen in table 1, part of the slower output growth was due to smaller increases in aggregate hours worked, primarily reflecting demographic factors such as the aging of the baby-boom generation. But, as shown in table 2, there was also a major decline in the rate of productivity growth – to which I will return shortly.