Caution needed with forward guidance and QE – IMF’s Gopinath
“Straitjacket” of ultra-loose policies may have delayed response to inflationary shock
Central banks need to refine their approach to lower-for-longer monetary policy strategies, said Gita Gopinath, deputy managing director of the International Monetary Fund, on June 26.
The economist argued at the European Central Bank conference in Sintra that central banks should be more cautious about “looking through” supply shocks. “Central banks may need to react more aggressively if the supply shocks are broad-based and affect key sectors of the economy, or if inflation has already been
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