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Mr. Dirk V Muir
Denmark, Finland, Norway, and Sweden form a tightly integrated region which has strong ties with the euro area as well as some exposure to Russia. Using the IMF’s Global Integrated Monetary and Fiscal model (GIMF), we examine spillovers the region could face, focusing on possible scenarios from the rest of the euro area and Russia, and the fall in global oil prices. We show that the spillovers from these scenarios differ in magnitude and impact, regardless of the high degree of integration among the four Nordic economies. These differences are driven by the fact that Denmark and Finland have no independent monetary policy, and Denmark and Norway are net energy exporters while Finland and Sweden are energy importers. We infer lessons for policy from the outcomes.
Mr. Dirk V Muir

and gas from the United States leads to a rebalancing in the global energy market. This is combined with a contracting demand for energy in emerging market economies only the global price of energy drops by almost 30 percent in the short run, tapering down to a permanent decline of 10 percent. 80 percent of the short run effect on the oil price is attributable to the boost in supply, and only 20 percent to the fall in demand. Over the medium term, the demand share of the oil price decrease falls to zero. This boosts real GDP in the rest of the world. The euro area