particular, while a lot of attention is paid to the increased probability of a recession in the united states, the baseline scenario for growth above potential this year and not far from this level for 2020 is usually not attached the same importance. clearly, the disruptive impact of a surprise along these lines could be far greater under current expectations. a second aspect of today ’ s global economic landscape that is worth highlighting relates to the turn towards protectionism of recent. the costs, both in the short and the long terms, impinged on the world economy from increased tariffs and other barriers to trade have been extensively discussed, and the impact is already evident in international trade figures. in fact, the wto recently reduced projections for global trade growth for 2019 to the lowest level in three years, to a significant extent as a result of rising commercial tensions and tariffs. 5 the implications for trade in intermediate goods within the framework of global value chains ( gvcs ) is particularly worrisome for a number of reasons : world trade organization ( 2019 ) : “ global trade growth loses momentum as trade tensions persist ”, trade statistics and outlook, press release no. 837, 2 april. the proliferation of gvcs lost momentum since 2011, and this trend has probably been accentuated by the aforementioned protectionist actions. however, their importance at present remains significant : around 70 percent of international trade is for production under these arrangements, a figure that can be roughly translated as trade in intermediate goods and services being about twice as large as that serving final demand. 6 notwithstanding their prominence, gvcs are particularly at risk due to ongoing trade conflicts. this is mainly due to the cumulative effect that tariff increases have on the total production cost of final goods, given their multiple border crossings within these frameworks, a principle that applies to other trade barriers as well. 7 additionally, a deeper sense of caution may hinder further country integration ( both at the intensive and extensive margins ) into gvcs, in view of the magnification of spillovers from bilateral tariff increases that they bring about. 8 thus, it would be reasonable to expect a further, albeit probably protracted, retrenchment in gvcs as regional and global production arrangements adjust to environments characterized by higher barriers to international trade. gvcs are an important driver of productivity gains in the partaking economies through a number of channels. in addition to the innovation, carstens, a. ( 2018 ) : “ global market structures and the high

to their offices and the weather turns warmer we will start to see people frequenting the small businesses that are the lifeblood of our city. unfortunately, job losses have not been only highly concentrated in particular industries, but also more concentrated among certain demographic groups. the pandemic and the ensuing economic downturn have done disproportionate harm to women, communities of color, younger workers, and the lowest paid. 2 the data are particularly sobering when we look at communities of color. recent research by my colleagues at the new york fed shows that more black and hispanic workers lost jobs compared to white workers, and black workers have been more likely to drop out of the labor force entirely, making it more challenging to rejoin in the future. 3 the black - white unemployment gap, which had reached historical lows in 2019, widened considerably during the spring and summer, undoing much of the progress of the past decade. while the gap has narrowed some since, closing this gap further will be an important part of a full recovery. black - owned businesses have also suffered disproportionately. 4 a report released by the new york fed in august found that black - owned businesses have been almost twice as likely to shutter during covid - 19 as white - owned firms. 5 a key area of our focus is to better understand what contributes to economic inequities and to finding solutions. 6 through our economic research and outreach efforts, we are working to understand how racial disparities play out in the labor market, and what can be done to change these outcomes. now i ’ ll turn to inflation, the other half of our dual mandate. although we have seen swings in some prices from the effects of covid, overall the inflation rate has been running below our 2 percent goal. with our economy and the global economy still far below full strength, i expect underlying inflationary pressures to remain subdued for some time. an encouraging sign is that measures of longer - run inflation expectations have retraced earlier declines as the economic outlook has brightened and are now at levels seen a few years ago. as the economy fully heals and reaches maximum employment over the next few years, i expect inflation will sustainably move to levels consistent with our 2 percent longer - run goal. 2 / 4 bis central bankers'speeches the path forward while the short - term outlook for the economy is highly uncertain, the longer - term picture is more favorable. with the ongoing vaccine rollout, more people