Growth
BoE paper warns escape from secular stagnation may ‘beggar thy self’
Authors outline an unappealing situation where the only escape comes from currency depreciation, but may nevertheless end up harming domestic welfare
Sarb takes action amid ‘extremely weak’ demand
Central bank revises down its forecasts as economic situation deteriorates; governor warns of possible cliff effect if there are further rating downgrades
Debate over Kenya’s growth potential continues – Njoroge
Private sector sees macroeconomic stability and infrastructure funding aiding growth in the long term, while banks are concerned about elections and a decrease in credit growth
BoE’s Broadbent: globalisation has been largely a good thing
Bank of England deputy says flexible labour market has helped dull the pain of adjustment to trade shocks, while lower prices have most benefited the poorest groups
Da Silva argues for ‘second-best solution’ to climate change
Financial sector must play a “pivotal” role in tackling climate change, but central banks should not be overstretched in the process, the BIS deputy general manager says
Bank of Canada hikes for first time in seven years
Bank of Canada becomes the latest advanced economy central bank to hike as the economy proves robust and inflation moves towards target
Vietnamese central bank cuts rates, despite IMF credit warning
Decision contradicts IMF advice to keep monetary policy on hold to contain rapid credit growth, but growth and inflation have disappointed
PNG governor urges country to reduce reliance on extractive industries
Bank of Papua New Guinea governor says country needs to diversify its industries and create a culture of savings
CEPR paper sketches ‘radical, realistic’ Greek reform plan
Stanford and Yale economists outline “unorthodox” policies that could put Greek debt on a sustainable footing – and might be acceptable to all negotiating parties
US policy having a larger impact on credit – BIS paper
Monetary policy’s effects on credit and housing markets have grown while the effects on inflation have weakened, paper finds
Household balance sheet adjustment a long process – Danish study
Research into patterns of consumption and saving before and after the 2008 crisis shows deleveraging can take a long time; consumption impact of rate hike is “modest”
Pakistan growth hits decade high – SBP report
Central bank says high growth, low inflation and solid investment are nevertheless overshadowed by falling exports, which have impacted reserves
IMF says remittances do not balance out losses caused by emigration
Remittances are key for providing support to LAC countries in terms of fiscal and financial stability; lack of labour resources and decline in productivity outweighs remittance support
House prices could outstrip income for decades – David Miles
Former Bank of England policymaker says under “plausible” assumptions, real house prices can rise without limit, implying high prices are not necessarily a sign of bubbles
BoE ups capital buffers as consumer credit outstrips income
“Pockets of risk” including effects of Brexit negotiations and car finance warrant attention, BoE says, though it stresses overall stability threats are at “normal” levels
Norges Bank study: regional network is supplying useful information
Central bank’s network of contacts is able to deliver better information on growth than other sources, report finds
BIS urges policymakers to exploit ‘window of opportunity’
Financial cycles are getting close to turning in many economies and central banks and governments must make sure they are prepared, the BIS warns in its 2017 annual report
Book notes: Can We Avoid Another Financial Crisis?, by Steve Keen
Steve Keen challenges “mainstream” economic thinking in this concise book, hoping to shift the political debate on debt
BIS paper links debt service lag to impact on real economy
Authors find the lag between borrowing and peak debt service helps explain why debt booms reduce future output and increase the probability of a crisis
MPC dissent grows amid BoE dilemma
Rates remain on hold but committee split 5-3 as some argue the BoE’s difficult trade-off has shifted in favour of tackling inflation
Wilkins offers optimistic assessment of Canadian economy
Carolyn Wilkins says Bank of Canada will assess whether current “considerable” monetary stimulus is still required; growth across sectors is an “encouraging” sign for the economy
UK election roundup: all eyes on Brexit negotiations
Economists react as UK vote delivers a hung parliament, casting doubt on the way forward with Brexit negotiations and causing a drop in the pound
Uzbek senate appoints new central bank chief
Mamarizo Nurmuratov becomes chairman of the Central Bank of Uzbekistan, following the death of his predecessor
Chile’s economy on sound and stable footing – report
Following earlier action in the year, central bank is unlikely to move interest rates again; growth forecasts revised following copper mine strike