Monetary Policy
Broadbent defends BoE position amid pension criticism
BoE deputy says ultra-low interest rates are not main culprit behind rising pension deficits, though IMF says pension funds and insurers are at risk from central bank action
UK PM says she will deliver ‘change’ to monetary policy
Theresa May criticises monetary policy for punishing savers and those without assets, promising to deliver change
BoE’s Saunders expects higher post-Brexit growth than central forecast
Bank of England’s newest committee member says the labour market is likely to prove more sluggish than the consensus suggests, but growth will be more positive
Fall in inflation only ‘temporary’ – Sarb governor
Positive factors underlying inflation decrease may not be here to stay, says Kganyago, emphasising a continued rise in inflation could threaten long-run growth
Mersch says eurozone deposit rates are only ‘mildly’ negative
ECB board member says rates can be “mildly” but not “wildly” negative before costs outweigh benefits; calls for faster progress on banking union
Hike now to avoid more action later, says Fed’s Lacker
Richmond Fed president adds his voice to growing number of Fed officials calling for rate hike; Loretta Mester insists proximity to US election need not prevent action at next meeting
RBI’s new MPC cuts rate at first meeting
Debate was “frank, often intense, but always friendly” says governor Urjit Patel, after monetary policy committee votes unanimously for a cut
US spillovers stronger for some countries than others – IMF paper
Paper assesses how US normalisation will spill across borders, identifying conditions where countries are most likely to be affected
DRC central bank more than triples rate amid reserves squeeze
Congo central bank raises headline rate five percentage points as foreign reserves continue to dwindle; economy is suffering from copper slump and difficult external environment
Inflation worries prompt action from Bank of Mexico
Central bank hikes interest rate by 50bps in last monetary policy meeting before the US presidential election; peso proves volatile in face of international events
Draghi defends ECB policy to German lawmakers
Monetary policy not causing low profitability at some German banks, ECB president says; calls on policy-makers to initiate structural reforms
IMF: rise of non-banks is reshaping policy transmission
Pass-through of monetary policy grows as non-banks become more important, but changed transmission mechanism demands better data to understand risk-taking channel
Bank of Canada should not raise inflation target – Obstfeld and co-authors
Central bank has been overtaken in transparency metrics, authors say; forward guidance would catapult Canada to top of rankings and could avoid the need for unconventional measures
Fed’s Yellen defends Brainard against congressman’s charges of political bias
No sign of political bias from FOMC members, Yellen says, amid accusations Lael Brainard might be looking for a job in a Hillary Clinton administration
Armenia cuts again as deflation deepens
Central bank cuts headline rate as inflation dips further below zero, though the board maintains it will be able to return inflation to target in medium term
Inflation expectations more sensitive near the zero lower bound – IMF study
IMF study examines whether monetary policy can boost inflation in constrained environment; countries near zero lower bound could see inflation respond more to shocks
Fed members differ on monetary policy, as Trump again attacks Yellen
Rosengren calls for “modest, gradual tightening”, while Kashkari sees slack in labour market; Republican candidate questions Fed’s political impartiality
Sama intervenes to ease liquidity pressure on banks
Saudi central bank makes deposits worth over $5 billion at commercial banks struggling with low liquidity, and introduces new repo facilities
ECB officials and Borio disagree on falling real rates
Vítor Constâncio and François Villeroy de Galhau emphasise importance of saving-investment mismatch, while Claudio Borio stresses financial cycle, but speakers find some points of agreement
Carney: green finance could help reverse long-run rate decline
Bank of England governor says green finance has the potential to send capital where it is most needed, and help advanced economies escape the problem of falling equilibrium interest rates
Bank of Israel moves to eight-meeting policy cycle
Cut in number of meetings reflects stability of economic indicators and will allow for more detailed analysis at each meeting, central bank says, though one member criticises loss of flexibility
Sarb governor fends off political criticism
Central bank would co-operate should inquiry into supervision powers be launched; monetary policy committee leaves rate on hold with the prospect of an end to the hiking cycle nearing
RBA’s Lowe: we are not ‘inflation nutters’
Philip Lowe underscores central bank’s “balanced” approach to controlling inflation in his first public appearance as RBA governor, and highlights other initiatives
Fed holds but two more dissenters call for hike
Case for hike is building, says Janet Yellen, but economy has “a little longer to run”; two more FOMC members join Esther George in voting for hike