Opinion/Monetary Policy

When currency empires fall

Is the dollar doomed as the world's reserve currency? CentralBankNet caught up with Professor Avinash Persaud at a lecture on Thursday 9 October as he set out his dramatic vision of how global currency markets might evolve over the course of the 21st…

What's missing at Asian central banks? Credibility

This article argues that Asia lacks a central banker with the clout enjoyed by the Federal Reserve chairman or the ECB president. This lack of credibility exists because of their aggressive manipulation of currency rates, their spotty histories of…

Rising tide of computer crime

UK banks have lost £4.5m to internet fraud in the last year. The majority of this fraud is thought to be carried out by organized criminal gangs in Eastern Europe. CentralBankNet reports on this growing phenomenon.

Greenspan: The man who does the opposite

This article looks at what it says is the recurring pattern in Alan Greenspan's life of saying the opposite of what he is thinking/doing. Giving the example of his obscure but now famous essay, "Gold and Economic Freedom" published in 1966 it asks why he…

IMF urges China to float yuan now

IMF managing director Rodrigo de Rato said on Wednesday 29 September that it would be to China's advantage to uncouple the yuan from the dollar. This article looks at the chances of China making some concession on the currency question at Friday's G7…

Bank of Canada Working Paper on Taylor Rules

In this Working Paper from the Bank of Canada the authors compute welfare-maximizing Taylor rules in a dynamic general-equilibrium model of a small open economy. They find that the welfare gains from moving to the optimal Taylor rule are larger than…

Is the euro good for Europe?

The euro has existed as a currency for over five years now, and notes and coins have been in circulation for over two. This article asks whether the coin of the realm in 12 European countries has accomplished its goals.

After Alan Greenspan, who?

This article looks at some of the favourites to replace Alan Greenspan as Chairman of the Federal Reserve when he steps down. Because of the Fed chairman's enormous influence on the U.S. economy and global financial markets, the selection will be among…

Measuring financial stability

Following the IMF's latest global financial stability review, released on Wednesday, one might expect central bankers to be relaxing. The Fund could see few threats on the horizon. In fact, central bank crisis watchers have never been busier. Mostly they…

Is India meddling with central bank's autonomy?

India's Trade minister has recently said "We don't want interest rates to harden". This article questions the effect of such "official" comments on the RBI's autonomy and says there's now the risk of monetary policy becoming a political football in India.

Bank to take market view

Hidden within the Bank of England's most recent inflation report is a significant tweaking of the Bank's inflation targeting stance. CentralBankNet reports on the Bank's adoption of market forecasts of interest rates for some of its projections.

Global currency answer to unstable world economy

This article asks whether floating exchange rates have proved to be the ideal replacement for the unsustainable adjustable exchange-rate pegs of the Bretton Woods monetary regime. If the global market economy is to thrive in the decades ahead, a global…

Are there too many yes men on the MPC?

This article reports that the Bank of England's Monetary Policy Committee has remained significantly more consensual than their predecessors, with an average "maverick rating" of just under three compared with nearly five among previous members. This…

Bulwarks against chaos

The sixtieth anniversary of the Bretton Woods agreement has prompted comment in the media and provided a peg for a number of conferences. At least two of these were held last month in beautiful surroundings in Italy. The Editor of Central Banking journal…

Central bank coxswain can't fully trust the crew

The Bank of England sees its role as a manager of other people's behaviour, this article says. A bit like the coxswain in a rowing race, the Bank both barks out orders and has a well-trained hand on the tiller. Central bankers, inevitably, like to think…

IRAQ'S NEW CENTRAL BANK

In April 2003 the central bank of Iraq was reduced to rubble. Its offices were ransacked, its records burnt, its vaults partly flooded (it sits on the banks of the Tigris), and its governor had fled. One of Saddam Hussain's sons had taken about $1…

Common West African central bank by July 2005

A common central bank for the five West African countries, Nigeria, Guinea, Ghana, Sierra Leone and The Gambia will have begun operations by July 2005, this article says. To be officially known as the West Africa Central Bank (WACB) the policy-guiding…

What's with Greenspan's hawkish talk?

This article says Alan Greenspan's recent more hawkish comments in testimony to Congress on July 20-21 have a lot to do with whom Greenspan was speaking for and to whom he was speaking. Mainly, his stern words about guarding against inflation reflect his…

Earlier release of Fed minutes would help market

This article says the Federal Open Market Committee rarely agree over the wording of the statement on the "why" even when they are unanimous about the "what." It suggests the committee should take a step favoured by some members and rejected by the…

With Euro as a model, group pushes global currency

The first meeting of the Single Global Currency Association met last Friday 9 July, with a modest attendance of seven. The group signed a resolution calling for the nations of the world to develop "a comprehensive plan for the implementation of a single…

WHY AM I HERE?

This week's CentralBankNet Special looks at the differing ways in which central banks define their purposes. One doesn't think of central bankers as being preoccupied with existential questions. But some are. Under Mervyn King's stewardship, for instance…

House prices force velvet revolution at Bank

Revolutions can be noisy affairs but central bankers are known for their inherent conservatism. So if there is a revolution taking place in the corridors of the world's major monetary institutions, we are not likely to hear a great deal about it, this…

Lessons from the past productivity booms

Distinguished lecture on economics in government: Lessons from past productivity booms by Roger Ferguson and William Wascher. The experience in the US suggests that extended periods of strong productivity growth are characterized by innovations in…