Policy normalisation makes communication particularly important, even more so when monetary policy has been very easy for a very long time and when different tools have been used to that end (policy rate at the zero lower bound or lower, quantitative easing, forward guidance).
Published on July 31, 2017 in :
Fiscal and monetary policy
Blind, complacent, cool-headed, driven by moral hazard, clairvoyant? Or should we follow the example of the Bank for International Settlements and call it “dissonant”? Which term best describes this summer’s market behaviour?
Published on September 20, 2016 in :
Markets and financial investments
This chart shows the evolution since February 2015 of the S&P500 stock market index. This is the umpteenth example of how closely expectations of Fed policy and the equity market are linked.
Published on April 7, 2016 in :
Markets and financial investments
In the Eurozone, China and the UK, purchasing manager indexes for the manufacturing sector declined in February. In the United States, in contrast, the manufacturing ISM rose but still held below 50, the level separating industrial expansion from contraction.
Published on March 4, 2016 in :
Economic cycle
This chart shows, since 1987, the evolution of the effective federal funds rate, US real GDP growth and nominal GDP growth.
Published on December 23, 2015 in :
Fiscal and monetary policy
The FOMC is meeting next week on 16 and 17 September and nervousness in markets is on the rise. US FOMC is unlikely to raise rates next week. Low inflation and a rising market uncertainty give no reason to rush the normalisation.
Published on September 11, 2015 in :
Fiscal and monetary policy