IMF Executive Board Concludes 2010 Article IV Consultation with Montenegro

Montenegro has been hit hard by the global financial crisis. Contagion and concerns about the robustness of the banking system have triggered large deposit withdrawals and a credit crunch. Moreover, the unwinding of the real estate boom has generated strong negative wealth effects that depressed demand. Finally, adverse terms of trade shocks have strained the industrial sector. As a result, GDP contracted sharply in 2009 and unemployment inched up. Meanwhile, upward pressures on wages and inflation have eased...