Destabilizing macroeconomic policies and poor economic performance are not likely to provide fertile ground for the optimism that usually accompanies surging asset prices. Ironically, low inflation, economic stability, and low risk premiums may provide tinder for asset price speculation that could be sparked should technological innovations open up new opportunities for profitable investment.
We welcome progress in leveraging IDA equity, which will enable the Bank to both target scarce concessional financing to the poorest IDA clients and increase allocations of non-concessional resources to countries at a more advanced stage of development, in line with the different needs and capacities of IDA’s evolving client base.