The soft landing for the global economy that was coming into view suddenly seems more elusive. Long-established trade relationships began to fray as a wave of larger than expected tariff announcements in early April hit the global economy. Growth forecasts were cut, and financial markets were jolted as policy uncertainty surged. Even as some of the initial shock has dissipated, a sense of apprehension hangs in the air. This year’s Annual Economic Report assesses the state of the global economy and discusses the key policy challenges. In addition, it offers an in-depth analysis of two important issues. The first is changes in the financial system, and their implications for the global transmission of financial conditions. The second is the design of a future monetary and financial system – one that embraces innovation to unlock new possibilities while preserving the trust in money that is fundamental to economic stability. […]