Tag Archives: Monetary Policy

Remarks by Mr Stephen S Poloz, Governor of the Bank of Canada, to the CFA Montreal and Montreal Council on Foreign Relations, Montreal, Quebec, 7 November 2017. Bank of International SettlementsStephen S Poloz: Understanding inflation - getting back to basics

Ed Harrison looks at inversion historically.Credit Writedowns Why the flattening yield curve doesn’t worry me yetEdward Harrison

Make no mistake, yesterday’s increase in interest rates was a big deal. Painful as it might be for a good share of the population, the real point is that the Bank is signalling the end of a particular phase of monetary policy. Since 2010 the counterpart to self-defeating austerity policies has been expansionary monetary policies. These have inflated assets - enriching the already-rich, while failing to stimulate wider economic recovery. Yesterday the Bank of England’s Monetary...

Bank of England increases interest rates for the first time in a decade in order curb high inflation squeezing UK households Base rate lifted from 0.25pc to 0.5pc; Mark Carney will give a press conference at 12.45pm to explain the central bank's decision Bank of England last hiked interest rates in July 2007; interest rates fell to historic lows to help the UK economy recover from the financial crisis Pound plunges on currency markets on dovish commentary from the central bank The...

According to the minutes of the last meeting of the monetary policy committee of the US Federal Reserve Bank, the most powerful monetary authority in the world, the committee members are split and unclear on what to do. “Some participants who counselled patience expressed “concern about the recent decline in inflation” and said the Fed “could afford to be patient under current circumstances.” They “argued against additional adjustments” until the central bank was sure that inflation was on...

I came across this article by Kevin Warsh that appeared in the Wall Street Journal last August, 2016. The article was re-posted by GATA.ORG.As you may know, Warsh is the currently the favorite to take over as Fed Chair when Janet Yellen's term expires next February.If you read the article you will find that Warsh sort of understands that Fed policy is confused and focused on either the wrong things or, things which the Fed has no set of tools to accomplish. On the other hand he seems to lack...

On May 6, 1997, just 4 days after coming to office in what was to become Tony Blair’s retrogressive regime, the then British Labour Chancellor Gordon Brown announced that Labour would legislate the so-called independence of the Bank of England. The BBC claimed this was the “most radical shake-up in the bank’s 300-year history”, which gave “the bank freedom to control monetary policy”. Gordon Brown’s legacy to the British people, of course, is in his famous ‘light touch’ regulation, which he...

The Vice President of the European Central Bank, Vítor Constâncio, gave the opening speech – Developing models for policy analysis in central banks – at the Annual Research Conference, Frankfurt am Main, on September 25, 2017. Last time I heard Constâncio speak in person, in Florence 2015, he was in typical Europhile central bank denial. He thought the Eurozone was fine, a great success given the low inflation, inferring that the ECB’s conduct had something to do with that. He didn’t talk...

It appears to be a mistake to refer to the price level when discussing the theoretical properties of an economy; at best, there are a few price levels in play at a given time. If we are referring to the measured level of a price index, such as the Consumer Price Index (CPI) there is no difficulty, however this aggregate price index should not be expected to correspond to any useful theoretical construct. This article explains my logic, and then looks at the practical implications of what...

There is a psychological bias to believe that exceptional events eventually give way to a return to “normal times.” But the world economy is far from a return to pre-2008 normality, with most of the obstacles to more robust recovery to be found on the demand side. Project Syndicate The Normalization DelusionAdair Turner