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Shocks in sentence

1003 examples of Shocks in a sentence

Others fear that, even without such financial shocks, the economy’s current strong performance will not continue when interest rates are raised.
Finally, both the interdependence and global risk that are evident in this crisis will and probably should cause countries to adopt policies with respect to financial structures that provide for some insulation from external shocks, even if such policies impose a cost.
By and large, these developments enhance an economy’s resilience to shocks and prevent economic collapse.
When farmers can produce more and earn more income, they become more resilient to shocks like severe weather and can put themselves and their families on a path to self-sufficiency.
The combination of external shocks and internal pressure from rising wages can serve as a powerful incentive for governments and businesses to pursue structural reforms.
If confidence declines, his historical understanding of the Great Depression of the 1930’s could leave him ill-equipped to prevent such shocks from sinking the US, and the world, economy.
They also explained why shocks to the economy might be amplified, and their effects persist, well after the original disturbance disappeared.
Although emerging economies have since accumulated larger foreign-exchange reserves and strengthened financial supervision and regulation, they remain vulnerable to external shocks, especially from the US, the eurozone, and Japan.
While the future of oil prices is uncertain, the fate of countries that have treated adverse shocks as temporary and reversible, and were then proven wrong, has seldom been encouraging.
One possible explanation for the mysterious combination of stronger growth and low inflation is that, in addition to stronger aggregate demand, developed economies have been experiencing positive supply shocks.
Such shocks may come in many forms.
Standard economic theory suggests that the correct monetary-policy response to such positive supply shocks depends on their persistence.
The Fed has justified its decision to start normalizing rates, despite below-target core inflation, by arguing that the inflation-weakening supply-side shocks are temporary.
If policymakers are incorrect in assuming that the positive supply shocks holding down inflation are temporary, policy normalization may be the wrong approach, and unconventional policies should be sustained for longer.
But it may also mean the opposite: if the shocks are permanent or more persistent than expected, normalization must be pursued even more quickly, because we have already reached a “new normal” for inflation.
This is the view taken by the Bank for International Settlements, which argues that it is time to lower the inflation target from 2% to 0% – the rate that can now be expected, given permanent supply shocks.
Trying to achieve 2% inflation in a context of such shocks, the BIS warns, would lead to excessively easy monetary policies, which would put upward pressure on prices of risk assets, and, ultimately, inflate dangerous bubbles.
Of course, advanced-country central banks hope such asset inflation won’t appear at all, because inflation is being suppressed by temporary supply shocks, and thus will increase as soon as product and labor markets tighten.
But, faced with the possibility that today’s low inflation may be caused by permanent supply shocks, they are also unwilling to ease more now.
Some regions will be hit by negative shocks that in other times and places would call for monetary ease or currency depreciation.
These so-called “asymmetric shocks” and “asymmetric structural problems” would be manageable if Europe otherwise had a flexible and dynamic economy.
Even before the eurozone’s debt problems emerged in 2009-2010, it seemed clear to many British that, in order to be resilient to shocks, a currency union requires greater integration, in particular, some form of fiscal union.
Asia’s ongoing transformation – rooted in the long-term conviction that more equitable, inclusive, and increasingly knowledge-led growth will help to reduce poverty and offer greater prosperity to its citizens – requires a short-term commitment to mitigating any global economic slowdown caused by new shocks.
We have entered an era in which “commercial banks may be less vulnerable to credit or economic shocks.”
More recently, polls showed widespread belief in decline after the Soviet Union launched Sputnik in 1957, then again during the Nixon-era economic shocks in the 1970’s, and after Ronald Reagan’s budget deficits in the 1980’s.
Today, with many Latin American economies increasingly vulnerable to external shocks, it is not unreasonable to think that IMF assistance could once again be necessary.
Those who make this claim seem to have in mind a model of a single state, which possesses two relevant features: limited fiscal sovereignty for regional and local governments and a substantial common budget from which regions hit by asymmetric shocks can receive transfers.
Instead, a great deal of flexibility, including within their labor markets, facilitated adjustment to asymmetric shocks.
Instead of looking at the wrong model – that of a single state – the EU and its member states should focus on the conditions required for the proper functioning of a currency union that has no common budget to compensate for asymmetric shocks.
First, utmost priority should be given to strengthening the mechanisms aimed at preventing pro-cyclical policies and large fiscal shocks.
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