FROM THE OFFICE OF PUBLIC AFFAIRS

The Treasury Department today published the concluding statement by the staff of the International Monetary Fund for this year's Article IV Consultation with the United States.

In the statement, the IMF staff highly commends the U.S. Administration and Federal Reserve for their accomplishments, noting that: "Sound monetary and fiscal policies have contributed to making the current U.S. economic expansion the longest on record." The IMF staff also underscores that the federal fiscal balance has improved steadily since 1992 and that consecutive fiscal surpluses were recorded in 1998-99, the first time in more than 40 years. In this regard, the staff state: "The favorable fiscal outlook, rising national saving, and low inflation have laid the foundation for strong investment spending which, in turn, has facilitated high rates of growth in both productivity and real income."

The IMF staff also notes the importance of the U.S. expansion to the global economy. "The strength of the U.S. economic expansion played a critical role in supporting world economic growth during the period of turbulence in 1997-98, and it has also provided significant support to the global recovery that now appears to be well underway." However, the IMF also takes the view that the growth in U.S. domestic demand in excess of supply and the perceived attractiveness of the investment environment have been reflected in a large and growing external current account deficit. In the view of the IMF staff, appropriate policies in our major trading partners to promote sustained expansion of their economies as well as U.S. policies aimed at sustaining noninflationary growth are necessary to produce a smooth rebalancing of global demand.

Release of this statement is consistent with a broad effort by the United States to enhance the transparency of the IMF. In recent years, approximately 80 percent of the IMF's members have begun publishing Public Information Notices for Article IV consultations. The United States is also part of a pilot project established by the IMF's Executive Board to allow countries to release the staff reports on their Article IV reviews. Nearly fifty countries and regions, including the United States, have already published staff reports on their Article IV reviews and many more plan to do so. The United States expects to release this year's staff report in late July after it has been reviewed by the Executive Board.