Monetary Policy
Kuroda uncompromising on deflation
New Bank of Japan governor says the central bank will need to expand its asset purchase programme and firmly communicate its commitment to raising inflation
ECB paper finds initial response to financial crisis was not good enough
Working paper suggests policy up to end of 2011 was insufficient to reduce credit availability problems for small businesses, underlining the importance of more recent innovations
Vietnam slashes rates in bid to kick-start economy
Central bank cites stable macro environment as it cuts policy rates by 100bp in an attempt to stimulate productive activity
Icelandic finance minister backs euro switch
Katrín Júlíusdóttir says adopting euro could help to restrain inflation and boost investment; Central Bank of Iceland publishes annual report
Central Bank of Egypt hikes rates as reserves dwindle and inflation rises
Monetary Policy Committee agrees 50 basis point rise despite ‘feeble’ growth, as inflation shows highest rise since 2010 and reserves fall to critical levels
Nominal GDP dismissed as viable policy target in Central Banking debate
Former Bank of England officials argue against adopting a nominal GDP target for monetary policy; economist Gabriel Stein brands it ‘absolute madness’
CNB paper formulates optimal policy for transition to euro
Working paper examines how Czech monetary policy should respond to uncertainty during the transition to the euro; finds exchange rate should be stabilised if transition is likely to be long
Former BoE deputy backs dual mandate for UK central bank
Former Bank of England deputy governor says central bank remit changes in UK budget yesterday were ‘disappointing’; advocates switch to a dual mandate targeting growth and inflation
RBA deputy governor says record low rates are beginning to work
Philip Lowe defends six rate cuts since November 2011, saying there are signs the Australian economy is beginning to respond to the stimulus; urges patience while effects feed through
Bank of England handed new remit
UK budget embeds flexibility in MPC remit; suggests the committee adopts explicit forward guidance as a new policy tool; looks to expand funding for lending scheme
RBI cuts benchmark rate as growth falters
Reserve Bank of India cuts interest rate for second time in 2013; struggling with falling growth rates but rising inflation
Korean paper says welfare cost of inflation is ‘underestimated’
Study contends that treating assets within M1 – the measure of cash and liquid assets in the economy – as non-interest-bearing in models fails to take into account full cost of inflation
Central banks can help promote reference rate choice, says BIS report
Bank for International Settlements working group finds money market appetite for adopting overnight reference rate; says central banks can help promote transparency
RBNZ’s McDermott backs simple forecasts over fan charts
Reserve Bank of New Zealand assistant governor says a simple policy projection can provide clarity to overall ‘forecast story’ and the relationships between different macroeconomic variables
BoE chief economist warns against inflation complacency
Bank of England’s Spencer Dale says he is concerned by ‘dangerous talk’ suggesting MPC should focus more on growth
Shirakawa examines ways for Japan to hit 2% inflation target
Bank of Japan governor says inflation will only be beneficial if it is driven by the right factors; says improved expectations are key to restoring Japan’s growth potential
RBI’s Subbarao bemoans contradictory demands on central bank
Reserve Bank of India governor says unique Indian growth and inflation dynamics make it impossible to satisfy everyone; deflects criticism over rates being both too high and too low
Central banks ‘are not done easing yet’, says Morgan Stanley chief economist
US investment bank’s Joachim Fels says central banks are entering into a third stage of monetary easing; eurozone growth forecast cut to -0.7%
Bank of Japan derivatives purchases threaten already low equity ratio
The BoJ's latest inflation-targeting weapon could challenge its balance sheet strength
RBI governor defends 3% inflation target
Duvvuri Subbarao says India’s high inflation in recent years does not represent a ‘new normal’; rejects upping the central bank’s 3% target
National Bank of Poland says rate cuts will bring inflation up to target
Polish inflation projected to fall to 1.3% in 2013 before rising to 2.6% in 2014, after benchmark rate slashed by 150 basis points in five months
Central Bank of Mexico cuts rates for first time in four years
Mexico slashes benchmark rate 50 basis points to combat falling demand and rising unemployment; Brazil and Canada hold rates steady
Lagarde sets out case for ECB rate cut and wider use of OMT
IMF managing director says ECB has room to cut rates and a European recovery is constrained by a lack of demand; suggests OMT programme could help countries ‘regain market access'
IMF’s Shafik says communication is central banks' ‘most important tool’
Deputy managing director Nemat Shafik believes communication is the most valuable of central banks’ unconventional policies; highlights benefits of maintaining a disciplined message