Search results for " monetary policy"
showing 5 items of 15 documents
UK QE reconsidered: the real economy effects of monetary policy inthe UK, 1990-2012 – an empirical analysis
2013
Empirical studies of so called ‘unconventional’ monetary policy – ‘Quantitative Easing’ or ‘Large Scale Asset Purchases’ - since the North Atlantic Financial Crisis of 2007-2009 in the United Kingdom and elsewhere have mainly focussed on the effect of policy on intermediate variables rather than the stated ultimate goal of such policies, boosting nominal demand and GDP growth. Secondly and relatedly they tend to focus on the crisis and post-crisis period, a time of extraordinary economic and financial dislocation, which creates counterfactual and attribution problems and fails to capture typical macroeconomic lag dynamics. Adopting the approach of Voutsinas and Werner (2010), and building o…
RISKS OF DISREGARDING THE INCOMPATIBLE TRINITY RULE: THE SWISS FRANC CRISIS CASE
2015
When designing economic policies, governments must take account not only of economic laws but also of certain rules of thumb. The incompatible trinity is such rule, which states that a country cannot simultaneously have a fixed exchange rate regime, mobility of foreign capital and an independent monetary policy. Traditionally, the rule has been generally observed, whether knowingly or not. The recent crisis triggered by the removal of cap on the Swiss franc is an illustrative example of what might happen if the said rule is disregarded.
The Euro and Monetary Policy Transparency
2002
This paper focuses on a possible explanation for the weakness of the euro, namely the lack of transparency of the European Central Bank's (ECB) monetary policy. In order to obtain a time-varying measure of monetary policy uncertainty in both the U.S. and Euroland, we estimate a Stochastic Volatility model using policy-adjusted short-term interest rates. We also analyze directly the impact of higher uncertainty on the euro-dollar exchange rate. The empirical findings are in line with those of other studies, and show that the U.S. Fed is more transparent than the ECB. This results in higher volatility of European interest rates, capital outflows, and a weaker euro vis-a-vis the U.S. dollar.
CHANGES IN THE EUROPEAN CENTRAL BANK (ECB) APPROACHES IN MATTERS OF MONETARY POLICY AFTER THE OUTBREAK OF THE INTERNATIONAL FINANCIAL CRISIS
2012
The problem of monetary policy is a current one, given the fact that now, through this component of the economic policy, the monetary authority of each state tries to solve the problems considered essential for each economy separately. Through this article I have tried to capture the major changes regarding the implementation of the ECB's monetary policy before and after the outbreak of the international financial crisis. Following the analysis I have shown that the monetary policy of the ECB is not a constant one in its actions and instruments used but it is adapted to a conjuncture context through which the European economy is passing through. Therefore, in this paper I have broadly shown…
Remarks on negative interest rates
2016
Negative nominal interest rates have been observed in several segments of financial markets. Being only partly a result of supply and demand and mainly enforced by the central banks, negative interest rates are getting more and more popular. While it is relatively easy to identify the reasons for this quite strange phenomenon, the con-sequences, especially the long-term consequences, are not too clear for both scientists and ordinary observers. This paper is an attempt to formulate some remarks on causes, evidence, and possible effects of negative interest rates. A warning is issued, with respect to monetary policy and financial stability.