Fiscal policy
Denmark central bank issues warning as economy heats up
The National Bank of Denmark cautions the labour market is tight and the economy may be close to overheating
Housing reform ‘will stabilise’ market – Danish central bank
The new taxation system aims to reduce price volatility by 20% and stem rising house prices in cities
Multiplier of spending cuts bigger than fiscal expansions, paper argues
Impact of austerity is at its peak during recessions, Richmond Federal Reserve paper finds
Fiscal stabilisation spurs growth in low fixed-asset sectors - IMF
Those with difficulty raising external funds benefit most from policy, paper argues
Archive – Interview: Allan Meltzer
Robert Pringle talks to Allan Meltzer, Carnegie Mellon professor and chair of the US Congress’s International Financial Institution Advisory Commission (the “Meltzer Commission”); first published in February 2003
Book notes: The Limits of the Market, by Paul de Grauwe
De Grauwe has produced a concise analysis into how markets and governments react with one another; but his lack of familiarity with the history of economic thought is surprising
Bank of Colombia paper charts fiscal multipliers in developing countries
Stronger fiscal-monetary co-ordination in developing economies during periods of expansion would extract more value from stimulus; fiscal multipliers higher in fixed exchange rate regimes
Turkish inflation begins to fall amid economic strength
Inflation fell back to single digits in July for the first time since January; economy buoyant amid stimulus measures in wake of failed coup
Tax cuts should focus on income from capital, French paper argues
Cutting taxation on labour is less effective in boosting growth, researchers say
US taxes low by global standards, say Chicago Fed economists
Overall burden of taxes is low by OECD standards, and taxes on capital income are notably lower than in Germany, economists say
Fiscal challenges a worry for Trinidad and Tobago – report
Central bank cites rising debt and failed fiscal consolidations as reasons for ratings downgrade that could make borrowing costs higher on international markets
IMF official says Mexico’s outlook seems bright
First deputy director Lipton says sound macroeconomic management has put the country in a strong position, despite a sharp rise in inflation and uncertainty surrounding trade relations
BEAC to implement measures to rebuild reserves across region
African central bank to restrict bank refinancing, while attempting to modernise its liquidity and monetary policy framework; previous monetary policy has contributed to current account deficit
Sarb’s Kahn: current conditions ‘do not bode well’ for economy
Kganyago’s advisor says political uncertainty is likely to continue throughout 2017 with no clear sign business or consumer confidence will improve
Former PNG governor accuses institution of ‘fuelling corruption’
Morauta says central bank has become “inanimate puppet” in government game whereby it continues to fund the growing deficit
Pace of monetary easing may slow, says Central Bank of Brazil
Committee unanimously cut interest rates to 10.25%, but political uncertainty could slow the future pace of easing; economist praises approach to monetary policy communication
Book notes: Crash Bang Wallop, by Iain Martin
A comprehensive study of the City of London and how it became the world’s leading financial centre prior to the financial crisis and the UK’s vote to leave the European Union
Bernanke urges BoJ to keep up its easing efforts
Former Fed chair recommends the central bank continue its aggressive easing, though he concedes “bad luck” could yet cause it to fail
Credit cycle matters for fiscal policy – BIS paper
Phase in financial cycle has “substantial” impact on public finances, authors find; commodities cycle less important but matters for some
BoJ paper sketches ‘vicious circle’ behind productivity traps
“Lacklustre” economic reforms and firms’ unwillingness to innovate may create a “negatively reinforcing” loop, the authors warn
Monetary policy has inevitable fiscal effects – Willem Buiter
Former Bank of England official rails against fiscal theory of the price level in speech to RBI, but says monetary policy still cannot escape its fiscal dimension
Singapore to work with China on capital market development, MAS’s Loh says
“Wider suite” of risk management tools needed to stem risks rising from capital market liberalisation; opportunities to coordinate on other Chinese initiatives
Spanish paper models effects of European ‘fiscal delegation’
Supranational fiscal authority would improve welfare, authors argue
Bank of Ghana starts to unwind tight monetary policy
Central bank slashes interest rates to 23.5% in largest cut since 2010; inflation shows signs of improvement but certain risks still loom over prices