Keyword: interest rates

This Finance survey examines that it seems likely that Japanese authorities intervened in the foreign exchange market recently to prop up the yen – see, for example: https://www.ft.com/content/455784ec-0465-46ee-8c73-fc5ce3e31c37. In such circumstances, intervention refers to purchases or sales of domestic or foreign currency without changing the monetary policy stance (a) Large-scale intervention by public authorities in currency markets can move exchange rates substantially (b) The effectiveness of foreign exchange interventions can last beyond one month

This Finance survey examines (a) The Federal Reserve has begun quantitative tightening (QT) to reduce the size of its balance sheet. Fed holdings of Treasury securities have declined by $800 billion relative to the March 2020 peak. The Fed currently holds $4.9 trillion of Treasury securities, significantly larger than the $2.5 trillion holdings prior to the Covid pandemic. A reduction in Fed holdings of Treasury securities measurably increases the interest rate on long-term U.S. Treasury bonds (b) A reduction in Fed holdings of Treasury securities measurably increases volatility in the Treasury market  

This week's European Economic Experts Panel statements: A) The ECB should aim to achieve an inflation rate that averages 2% over time. B) The ECB should take account of the environmental implications of its policy decisions. C) The objectives set for the ECB by Treaty should make maximum sustainable employment of equal importance as price stability.

This week's US Economic Experts Panel statement: The Fed's revised strategy to focus on employment shortfalls and a more flexible interpretation of the inflation target will make little practical difference to monetary policy outcomes over the next decade.

This week’s IGM Economic Experts Panel statement: A ban on very short-term loans at very high annualized interest rates (aka payday lending) would make most people who use or might use them better off.

This week's IGM Economic Experts Panel statements: A) The Fed should raise its target interest rate when it meets in mid-December. B) The Fed should have raised interest rates sooner, rather than leaving them near zero for this long.

This week’s IGM Economic Experts Panel statement: The Fed should wait until its preferred measure of inflation (Core PCE) is clearly rising — and not just forecast to rise — before it begins hiking interest rates. 

This week’s IGM Economic Experts Panel statement: Informed postmortems of Ben Bernanke’s Fed chairmanship will judge favorably the Fed's creative and aggressive policy initiatives from autumn 2008 through early 2009.

This week’s IGM Economic Experts Panel statement: Conventional economic reasoning suggests that it would be a good policy to enact the recent Senate bill that would let undergraduate students borrow through the government Stafford program at interest rates equivalent to the primary credit rates offered to banks through the Federal Reserve's discount window.