What is new

• New working paper: Tariff Shocks Weaken Dollar Dominance

The U.S. reciprocal tariff hikes weaken global demand for dollar-denominated assets because they erode the dollar’s role in trade invoicing and financing.

• Sovereign Debt Responses to the COVID-19 Pandemic. Accepted by Journal of International Economics.

To borrow in time of need, governments need to maintain credible fiscal rules and debt sustainability in good times.

• Taxing the rich to finance redistribution- evidence from permanent tax increase in Singapore, with Sumit Agarwal, Wenlan Qian, Bernard Yin Yeung. Accepted by Management Science.

Raising income tax does not affect the rich's consumption, but increases the poor's consumption through redistribution.