Monetary policy
BoJ paper suggests models may misrepresent impact of easing at ZLB
Working paper questions why many studies in monetary economics use model that does not account for zero lower bound; finds model tends to underestimate term premia
RBI paper scrutinises monetary policy transmission
Research analyses strength of monetary policy transmission in range of Indian financial markets; says it is conducted most effectively to money markets but has ‘limited’ influence on stock markets
Mersch lists monetary policy dos and don'ts
ECB board member tells Luxembourg audience monetary policy should take responsibility for ‘averting Armageddon', but there are limits to what it can do
Former BoE policy-makers demand action from Mark Carney
John Gieve says Carney is likely to introduce conditional forward guidance and expand QE; Rachel Lomax backs FPC remit that requires a “consistent message” among its members
ECB’s Cœuré says it is time to think about exit from unconventional policies
Executive board member says time is not yet right to start withdrawing extra liquidity provision, but such policies cannot be kept in place forever
ECB paper builds eurozone financial conditions indexes
Researchers confirm financial conditions differed across the eurozone before and after the crisis; gap shrinks when monetary policy variables are included in indexes
BoJ paper creates new framework for identifying monetary policy shocks
Working paper uses TVP-VAR model to identify the impact of conventional and unconventional monetary policy shocks on the real economy at the zero lower bound
IMF issues warning to Asian central banks on risk of overheating
Regional Economic Outlook says some Asian central banks may need to tighten policy to avoid stability risks; examines complicated effects of Japanese monetary easing
G-20 report says move from stabilisation to growth requires ‘difficult balancing act’
G-20 meeting report urges carefully calibrated fiscal tightening to ‘nurture’ recovery; backs accommodative monetary policy and says emerging markets should use rapid growth to build buffers
BoE’s McCafferty denies Monetary Policy Committee has ‘gone soft’
MPC member highlights positive signs for growth but says inflation is ‘more concerning’; expects inflation to remain above target but says a response is not yet necessary
Independent Scotland would face ‘significant risks’ under sterling union, says Westminster
UK government report points to drawbacks of all the currency options for an independent Scotland; refuses to back Scotland’s preference for a sterling union
UK economists divided over BoJ easing
Treasury Select Committee witnesses debate whether BoJ radical easing will overcome decade of deflation; economists fear an ‘unruly spike’ in yields when quantitative easing is unwound
SNB paper analyses relationship between monetary policy and financial integration
Study finds that monetary policy can have a larger effect on output and inflation under conditions of greater financial and trade integration
Fed’s Raskin assesses impact of inequality on monetary policy
Governor Sarah Bloom Raskin says inequality in US could affect transmission of monetary policy to real economy; predicts ‘increasingly potent’ policy as house prices rise
Czech bulletin dissects monetary policy transmission
An economic research bulletin compiled by the Czech National Bank explores relationship between monetary policy and real economy in five articles
IMF flags growing risks from low interest rate environment
Global financial stability report urges caution by central banks employing loose monetary policy; says lack of adjustment to medium-term challenges could create ‘chronic phase’ of crisis
IMF's Blanchard warns Europe could drag world economy down
IMF chief economist says ‘three-speed’ global economy could be dangerous; World Economic Outlook urges central banks to keep policy loose but be ready with an exit strategy
World Bank says east Asia and Pacific at risk of ‘overheating’
Asia-Pacific policymakers urged to consider withdrawing stimulus – fiscal and monetary – as region’s larger economies reach their productive capacity and face inflationary pressures
FOMC members saw QE continuing ‘through midyear’ at March meeting
Participants at the FOMC’s last meeting broadly agreed to continue QE at existing pace ‘through midyear’ but failed to reach a consensus on when to slow asset purchases
BoJ minutes reveal tensions over asset purchase programme
Minutes of final meeting under governor Masaaki Shirakawa show disagreement over whether to loosen policy further, including changes to quantitative easing
Lagarde fears ‘unintended consequences’ of monetary easing
IMF managing director fears side effects from low interest rates and asset purchases; says there is a limit to the share of the burden of recovery that monetary policy can take
Chilean paper finds central bank’s forecasts influence private sector expectations
Working paper finds evidence the private sector updates inflation expectations based on the Central Bank of Chile’s forecasts; suggests more central banks should publish forecasts to aid policy
Assistant governor says RBNZ should not be target of exchange rate ‘angst’
John McDermott deflects criticism that the central bank is failing to correct the exchange rate, warning hard-won inflation credibility could be lost and other factors are at play
Fed ‘stimulus’ chokes indirect finance to SMEs
Low interest rates in the US are crowding out indirect finance to SMEs and distorting financial markets generally. The Fed needs to act by raising rates to 2%, argues Ronald McKinnon