Productivity
How central bank mistakes after 2019 led to inflation
Central banks must acknowledge their own mistakes and outline concrete steps to restore the public’s confidence in their ability to ensure price stability, write Graeme Wheeler and Bryce Wilkinson*
US risks slipping back into secular stagnation, says Rajan
Fed has “good chance” of defeating inflation but US economy has deeper problems, economist says
Book notes: Two hundred years of muddling through, by Duncan Weldon
Insights into UK economic history offer lessons for today’s policy-makers
Book notes: A full-value ruble, by Kristy Ironside
Soviet experience shows MMT worked, only with far more challenges and downsides than promoters envisioned
Central bank of the year: Bank of Korea
South Korea’s central bank was the first developed-world central bank to tighten policy to address inflationary risks
IMF paper finds falling r* should eventually reverse
Authors say several policies could be used to push natural rate back up
Fed signals time will be right for rate hike ‘soon’
QE set to end in March, with balance sheet to start shrinking after rates rise
Labour market news matters for business cycle – BoE paper
Findings suggest previous focus on productivity is too narrow
Turkey’s Dornbusch moment
Turkey’s new deposit scheme sets the stage for hyperinflation, writes Barry Eichengreen
Masaaki Shirakawa on lessons from crisis and how to reform central banks
The former governor reflects on a turbulent 40 years at the Bank of Japan, and considers how central banks might face up to the challenges of the future
Eurozone QE helped increase R&D spending, paper finds
Firms that had bonds bought by the ECB increased R&D spending by 9% on average
Bank of Israel calls on divided parliament to pass budget
Central bank stresses it includes key investments to boost productivity and growth
‘Say what?’ Trust in central bank communications
Central banks are changing how they communicate with different audiences, but judging the success of these communication efforts is difficult
James Bullard on Fed policy, action and governance
St Louis president calls for tapering amid “exceptional” job market and risk of “more persistent” inflation, quantifies ‘big tent language’ for pioneering AIT move, and details Congress’s role in Fed ethics oversight
ECB calls for changes to draft Austrian central bank law
Mechanism for paying productivity council’s head would be monetary financing, ECB says
UK looks to boost long-term investing
Working group says action needed to encourage illiquid investing without risking instability
Strategies for change: central banks’ quest for diversity
Dedicated diversity strategies remain uncommon among central banks, despite growing recognition of the need for better minority representation
Demand shocks can have permanent impact on US economy – Fed paper
Authors find hysteresis is an important driver of longer-term growth trend in US
The ‘golden age’ of central banking has passed
Central banks face multi-faceted challenges and weakened autonomy amid highly polarised inflation expectations
Spanish governor favours green monetary policy
Hernández de Cos stresses ECB should account for climate risks in its price stability mandate
A return of the inflation monster?
There are fears that a shift in intellectual approach towards running economies ‘hot’ could herald a return of the money-eating inflation era
Central banks take less than 50 minutes to fix critical outages
Time tolerances for critical system downtime range from one to 32 hours
Lifetime achievement: Charles Goodhart
The LSE and BoE veteran economist has his own ‘law’, and played a key role in the establishment of monetary policy in the UK, Hong Kong’s peg and the ‘New Zealand model’, which influenced a generation of central bankers
The Covid crisis, central banks and the future
Crisis responses have had positive initial outcomes, but also exacerbated significant underlying challenges that raise concerns related to exit strategies and the future for central banks