Skip to main content

Home/ Jacob Solomon's group - M2015(B)/ Group items tagged central

Rss Feed Group items tagged

Zube Iheobi

European Central Bank slashes interest rates as eurozone suffers 'lowflation' crisis - ... - 0 views

  •  
    this is relevent to this weeks reading because it amother way of the government making changes, however here its not the government its the central bank. and acts of the central baks are more monetary poilicy as they predominantly affect AD
Haydn W

Mexican Central Bank Head Warns of Spillover Effects of Dramatic Monetary Policies - WS... - 0 views

  • SINTRA, Portugal—The head of Mexico's central bank said Tuesday that he supports the dramatic measures that central bankers in advanced economies have taken to stabilize their economies, but emerging markets must be mindful of the spillover effects these policies may have.
  • "The unconventional monetary policies have…established the ground for a recovery in economic activity," said Agustin Carstens, governor of Mexico's central bank
  • The inflows have led to higher exchange rates in emerging markets, Mr. Carstens said, weakening exports, as well as a compression of interest rates, leading to bubbles in some real-estate markets.
  • ...3 more annotations...
  • One byproduct of these policies has been to pump new money into financial markets. Some of that money has found its way to emerging markets as investors sought higher-yielding assets.
  • "Authorities need to think about how they can spread, through time, the adjustment process,"
  • More broadly, emerging economies "shouldn't depend on advanced economies to generate growth," Mr. Carstens said.
  •  
    Agustin Carstens, governor of the Central Bank of Mexico warns about the spillover affects into the developing world from advanced economies' banks' monetary policies. Money has found its way into emerging markets leading to higher exchange rates and weakening exports according to Carstens. This is a dangerous bubble that could be liable to burst should growth pick up soon. Overall this article provides an interesting insight into how one countries policy choices can have global consequences and how international economics really is.
Clemence Lafeuille

The Role of Central Bank in a Developing Economy of a Country - 0 views

  •  
    Fair enough, this is not the classic article we usually post here. Nonetheless, I found it to be an article that emphasises the role of central bank, a little bit like a mini notebook. It connects central bank to economic development well and explains what are possibilities of policies for the central bank.
Sholpan Marabayeva

UPDATE 3-Russian central bank prepares strategy for sharp oil price drop - 1 views

  •  
    This is an article on how Russia's central bank will address the sharp oil price drop. This article relates to what we are doing because it talks about the strategy of the Russian central bank. the central bank is a key tool for the monetary policy, which we are covering right now. Also this article briefly mentioned balance of payments, and the negative consequences of the bank failing to address this issue. It was a very interesting read.
Yassine G

Indonesia's inflation seen slowing in April - 0 views

  •  
    This article is not very long, however, we can see a lot of the concepts studied this week within the article. It is clear that Indonesia has an independent central bank. It is also clear that some actions are being taken in order to reduce inflation and they seem to be successful as inflation has actually fallen, however, this small amount of change could be good in the long run. 
Amanda Anna G

US Fed debates plans to exit easy monetary policy - FT.com - 0 views

  • The US Federal Reserve is debating yet another addition to its forward guidance as the central bank starts to plan an exit from easy monetary policy.
  • ccording to the minutes of April’s meeting of the Federal Open Market Committee, “a number” of officials wanted to give more information about how long the Fed will wait before it starts to reduce the size of its balance sheet.
  • The minutes show how the Fed is starting to wrestle with the complexity of raising interest rates with a balance sheet bloated to more than $4tn by repeated rounds of asset purchases over the past five years.
  •  
    As a number of officials wanted to give more information about how long the US Federal Reserve will wait before it starts to reduce the size of its balance sheet, the central bank starts to plan an exit from easy monetary policy. 
Daniel B

Credit-Easing Steps by Central Banks, at a Glance - 0 views

  •  
    As early as next month, the European Central Bank is expected to act to counter persistently low inflation and to try to invigorate the eurozone's lethargic economy. Among the evidence the ECB will weigh: Thursday's report that the 18 countries that use the euro collectively grew just 0.2...
Haydn W

ECB's Draghi says euro zone must 'complete' monetary union | Reuters - 0 views

  • ECB's Draghi says euro zone must 'complete' monetary union
  • (Reuters) - Euro zone countries must "complete" their monetary union by integrating economic policies further and working towards a capital markets union, European Central Bank President Mario Draghi said.
  • Draghi said structural reforms were needed to "ensure that each country is better off permanently belonging to the euro area".
  • ...3 more annotations...
  • He said the lack of reforms "raises the threat of an exit (from the euro) whose consequences would ultimately hit all members"
  • He said an economic union would make markets more confident about future growth prospects -- essential for reducing high debt levels -- and so less likely to react negatively to setbacks such as a temporary increase in budget deficits.
  • Unifying capital markets to follow this year's banking union would also make the bloc more resilient.
  •  
    This article, from news agency Reuters, outlines Mario Draghi's, head of the European Central Bank (ECB), statement in Italy this week, regarding the Eurozone, a form of monetary integration. Draghi outlined the need for European countries to complete the monetary union and integrate policy to avert another crash. 
Haydn W

The return of the US dollar | Mohamed El-Erian | Business | theguardian.com - 4 views

  • The return of the US dollar The resurgence of the US currency could be the first promising step in steering the world economy away from crisis
  • The US dollar is on the move. In the last four months alone, it has soared by more than 7% compared with a basket of more than a dozen global currencies, and by even more against the euro and the Japanese yen.
  • Two major factors are currently working in the dollar’s favour
  • ...11 more annotations...
  • Second, after a period of alignment, the monetary policies of these three large and systemically important economies are diverging, taking the world economy from a multi-speed trajectory to a multi-track one.
  • First, the United States is consistently outperforming Europe and Japan in terms of economic growth and dynamism – and will likely continue to do so – owing not only to its economic flexibility and entrepreneurial energy, but also to its more decisive policy action since the start of the global financial crisis.
  • With higher US market interest rates attracting additional capital inflows and pushing the dollar even higher, the currency’s revaluation would appear to be just what the doctor ordered when it comes to catalysing a long-awaited global rebalancing – one that promotes stronger growth and mitigates deflation risk in Europe and Japan.
  • ECB President Mario Draghi signalled a willingness to expand his institution’s balance sheet by a massive €1 trillion ($1.25 trillion).
  • Furthermore, sudden large currency moves tend to translate into financial-market instability.
  • There is also the risk that, given the role of the ECB and the Bank of Japan in shaping their currencies’ performance, such a shift could be characterized as a “currency war” in the US Congress, prompting a retaliatory policy response.
  • Today, many of these countries have adopted more flexible exchange-rate regimes, and quite a few retain adequate reserve holdings.
  • an appreciating dollar improves the price competitiveness of European and Japanese companies in the US and other markets
  • But a new issue risks bringing about a similarly problematic outcome: By repeatedly repressing financial-market volatility over the last few years, central-bank policies have inadvertently encouraged excessive risk-taking, which has pushed many financial-asset prices higher than economic fundamentals warrant.
  • This is not to say that the currency re-alignment that is currently underway is necessarily a problematic development; on the contrary, it has the potential to boost the global economy by supporting the recovery of some of its most challenged components. But the only way to take advantage of the re-alignment’s benefits, without experiencing serious economic disruptions and financial-market volatility, is to introduce complementary growth-enhancing policy adjustments, such as accelerating structural reforms, balancing aggregate demand, and reducing or eliminating debt overhangs.
  • The US dollar’s resurgence, while promising, is only a first step. It is up to governments to ensure that the ongoing currency re-alignment supports a balanced, stable, and sustainable economic recovery. Otherwise, they may find themselves again in the unpleasant business of mitigating financial instability.
  •  
    This article details the so called resurgence of the US dollar, in terms of currency value. The currency itself has risen by around 7% against other currencies but Guardian economist Mohamed El-Erian warns that without the appropriate accompanying central bank policies, the rise of the dollar could cause further market volatility and at worst a new crash. El-Erian calls for governments to enact policy to support balance the current currency realignment. 
John B

Reserve Bank India may eventually tighten rates to tame inflation: HSBC - The Economic ... - 0 views

  •  
    This article is dealing with the inflation in India. The inflation in India are seemed to be sticky, but due to El Nino (the warmer-than-average sea surface temperature in the central and eastern tropical Pacific Ocean). It contributes to extreme droughts that makes the price of food increase, and therefore the inflation for food increase
Clemence Lafeuille

Monetary Union Works Because Europe Is Already Integrated - 0 views

  •  
    The monetary union of the Euro zone has been heavily criticized as only a place that shares one thing: its currency. It has been judged however they have incorrect, due to the integration of the countries' economies.
  •  
    This article really looks into how a monetary union can work when it is so divided, and it goes on to say that the political ties are what enables it to thrive without major disturbances. It also mentions how important these ties are for the central bank and monetary policy of the bloc to work
Clemence Lafeuille

Pound falls on Bank meeting minutes - 2 views

  •  
    This article presents how a report done by the Monetary Policy Committee of the UK has lead to the value of the pound falling slightly against the dollar. This shows how the direct action of a central bank (here refusing to increase the interest rate) can impact the exchange rate.
Mariam P

Russians boost foreign-currency deposits in October -central bank data - 6 views

  •  
    Russians had 3.856 trillion roubles' ($82.27 billion) worth of foreign-currency deposits as of Nov. 1, compared to 3.421 trillion roubles on Oct. 1, an increase of more than 12 percent. Their rouble deposits fell by 0.3 percent to 13.829 trillion roubles over the same period, according to the central bank.
  •  
    The article presents an insight on what seems to be the most significant economic effect of the sanctions the EU has imposed on it in response to their invasion of the Ukraine.
Marenne M

Nigeria devalues currency as oil prices drop - FT.com - 5 views

  • Nigeria has devalued its currency by nearly 10 per cent and raised interest rates to record levels, in one of the clearest signs yet of how oil producing nations are struggling as energy prices drop sharply.
  •  
    This article describes the devaluation of the fixed currency rate of Nigeria as a result of the decreased energy prices. Nigeria is an oil producing country and therefore earns a lot of its income through oil exports. Now that the prices of other energy has dropped, there is a lower demand for the Nigerian oil, leading to fewer exports. The Nigerian central bank has now devaluated its currency by 8.4 percent in the hope that the lower prices will encourage a greater demand for their oil exports.
Haydn W

Greece's leader warns Merkel of 'impossible' debt payments - FT.com - 0 views

  • Greece’s leader warns Merkel of ‘impossible’ debt payments
  • Alexis Tsipras, the Greek prime minister, has warned Angela Merkel that it will be “impossible” for Athens to service debt obligations
  • The warning, contained in a letter sent by Mr Tsipras to the German chancellor and obtained by the Financial Times, comes as concerns mount that Athens will struggle to make pension and wage payments at the end of this month and could run out of cash before the end of April.
  • ...12 more annotations...
  • just before Ms Merkel agreed to meet Mr Tsipras on the sidelines of an EU summit last Thursday and invited him for a one-on-one session in Berlin
  • Mr Tsipras warns that his government will be forced to choose between paying off loans, owed primarily to the International Monetary Fund, or continue social spending.
  • He blames European Central Bank limits
  • “Given that Greece has no access to money markets, and also in view of the ‘spikes’ in our debt repayment obligations during the spring and summer . . . it ought to be clear that the ECB’s special restrictions when combined with disbursement delays would make it impossible for any government to service its debt,” Mr Tsipras wrote.
  • He said servicing the debts would lead to a “sharp deterioration in the already depressed Greek social economy
  • Mr Tsipras was rebuffed in efforts to secure quick financing from either the ECB or eurozone lenders at Thursday’s Brussels meeting
  • In an interview, Luis de Guindos, Spanish finance minister, said his eurozone counterparts would not sign off on any new bailout funding until a full set of approved reforms was passed
  • Mr Tsipras’s five-page letter is particularly critical of the ECB
  • The Greek prime minister insisted the ECB should have returned to “the terms of finance of the Greek banks”
  • Far from going easier on Athens, the ECB is considering whether to give its guidance to Greek banks more authority by making it a legally binding requirement not to add to their T-bill holdings.
  • He also criticised the ECB for only increasing the amount of emergency central bank loans to Greek lenders “at shorter intervals than normal and at rather small increments”
  • Mr Tsipras wrote that Athens was “committed to fulfilling its obligations in good faith and close co-operation with its partners”, he also warned Ms Merkel that a failure to find short-term funding could lead to much bigger problems.
Haydn W

Coal India could have helped slash production cost by 12%: Power Companies - The Econom... - 0 views

  • KOLKATA: Coal India Ltd could have helped power companies save their production cost by 12%, or 35 paise a unit
  • The state-run monopoly coal supplier on Tuesday declared a dividend of Rs 29 a share.
  • CIL increased coal prices by a minimum 30% for all thermal coal used by power companies over the past three years
  • ...3 more annotations...
  • This enabled the company to increase its cash and bank balance from about Rs 45,000 crore during 2010-11 to Rs 62,000 crore in 2012-13,
  • Most of the additional reserves came from higher prices as production did not rise at the same pace. This fiscal year, the company is likely to miss its target on coal production by about 17 million tonnes and sales by some 15 million tonnes.
  • Power tariffs are regulated by Central and state regulatory commissions, however, coal prices are not. Every increase in coal prices leads to increased power generation costs which need to be passed on to consumers.
  •  
    This article explains how production costs in India could have been cut if Coal India had kept prices lower. The article also tells us that the company has a monopoly on the industry and is state-run which has lead some people to criticise the government. The company has been accused of protecting its own interests by raising prices to cache its bank balance. 
John B

Is Education a Public Good or a Private Good? - Innovations - Blogs - The Chronicle of ... - 1 views

  • Advocates for more generous support of students frequently bemoan what they perceive as a social shift from viewing higher education as a “public good” to viewing it as a “private good.”
  • The concept of public goods is central to economic analysis of the role of government in the allocation of resources. Public goods are defined by two characteristics: 1) Non-excludability: It is not possible to exclude non-payers from consuming the good. 2) Non-rivalry in consumption: Additional people consuming the good do not diminish the benefit to others
  • Advocates for more generous support of students frequently bemoan what they perceive as a social shift from viewing higher education as a “public good” to viewing it as a “private good.” What they mean is that the public gets benefits from people going to college and should not be transferring responsibility for the costs of education to students themselves.
  • ...1 more annotation...
  • This is not an either/or question. The benefits of college are not all public and they are not all private. The debate should be over what fraction of the cost of postsecondary education students should bear and how large society’s subsidy to them should be. It should not be over whether education is a “public” or a “private” good.
  •  
    This article is telling us about how the higher education (college) is allocated. If it is a private good or a public good. I would say that for the moment, it is a good that is can be excluded for people who cannot afford it. Therefore it is not a public good.
Daniel B

Euro-zone lowflation - 0 views

  •  
    This article shows how important it is to sustain proper inflation. It should be not too high as well as not too low. Central Bank is able to control it with the interest rate.
John B

William Easterly: Singing About Fighting Poverty, Slightly Off-Key - WSJ - WSJ - 1 views

  • The progress against poverty in China is obvious, but whether China's government deserves to be held up as a development model is not so clear. For instance, who gets to decide whether mainland Chinese citizens should be content with improved standards of living and so few protections against the frequent violations of their rights by their own government?
  • Extreme poverty in China has been reduced over the past few decades precisely because Beijing permitted the freedoms of a market economy to infiltrate a communism-blighted society. If the regime's repression now worsens, count on the end of the country's high growth rates.
  • Yet freedom is arguably central: first, as an end that people want for themselves, and, second, as the most well-proven path to escaping poverty. Consider among others North America, most of Europe, Australia, New Zealand, Japan, South Korea, Taiwan and Chile, where the answer to poverty was economic and political freedom.
  •  
    In this article, the author discuss the affects of the actions of the government in China. It is a modern topic today due to the demonstrations being held in Hong Kong. The authors mentions that the statement about entering a democracy, and then pulling back on the decision means that they were on the right track to get the market more free from the government, hence less poverty, but now he thinks it is gonna worsen the economical conditions. A free market has saved many economies, why should China still not give in for the human rights and improve their economy?
Mariam P

Bank of Israel Says Action Needed to Lift Inflation to Target - 5 views

  •  
    The article is about the inflation rate in Israel. Now the inflation rate has its lowest level in the past seven years. The central bank of Israel is worried and suggests some actions that will help to return the inflation rate to the price stability.
  •  
    This article is about the inflation rate in Israel and how it is approaching 0. This is critical and Israel has recognised the need to bring back inflation rates to the government's target rate.
1 - 20 of 25 Next ›
Showing 20 items per page