Operating framework
BoJ should provide ‘more realistic’ projections – former policy board member
Claims constant overestimation of inflation expectations undermines credibility
Should more attention be paid to house prices?
The Czech National Bank’s experiences offer insights into using a broader inflation measure with a greater weight on housing to address both monetary and macro-prudential policy requirements
Bank of Jamaica outlines plans to become ‘modern’ central bank
Initiatives to implement inflation-targeting framework and liberalise forex rate already under way; IMF says strengthening autonomy will help
Monetary policy has inevitable fiscal effects – Willem Buiter
Former Bank of England official rails against fiscal theory of the price level in speech to RBI, but says monetary policy still cannot escape its fiscal dimension
RBI makes fresh amendments to liquidity framework
Central bank continues reforms begun under Raghuram Rajan and asks government for new tools; markets still face “liquidity overhang” from demonetisation
BIS report: build liquidity co‑operation early to prepare for crisis
CGFS report urges central banks to build networks domestically and across borders to have liquidity ready for the next crisis
Icelandic leaders clash on possible peg
Prime minister challenges finance minister’s assertion that the krona needs to be pegged; government launches review of exchange rate policy
Daily open market operations paying off – National Bank of Denmark
Introduction of daily open market operations has smoothed liquidity management, stabilising the money market reference rate
Tanzanian central bank slashes discount rate
Central bank cuts discount rate for the first time since 2013, from 16% to 12%; increase in NPLs has discouraged commercial banks from lending
Ending speculation on the Czech forex cap: quo vadis, CNB?
David Vavra suggests a method the Czech National Bank could use to free itself from the mounting pressure on its exchange rate peg, avoiding a “Swiss-style” exit
Iran needs to overhaul monetary operating framework – IMF
Absence of policy rate and emergency lending facilities is creating instability, fund warns; central bank council “dominated” by representatives from other government agencies
Kazakhstan’s long path to inflation targeting
After a slow start, the National Bank of Kazakhstan’s implementation of inflation forecast targeting is beginning to mature. By Warren Coats
Basel III LCR affects RBI monetary operations – paper
Liquidity coverage ratio affects the central bank’s operational target via its impact on the unsecured overnight money market
PBoC’s hike signals policy management shift
The decision by China’s central bank to raise a suite of interest rates around Chinese New Year marks a shift towards market-based tightening, argues Hui Feng
Fed’s Mester says public should not hold policymakers to ‘unrealistic account’
Monetary policy cannot and should not be used to spur productivity growth, says FOMC member; unwinding of Fed’s mortgage portfolio may help guard it against calls to enter the realm of fiscal policy
IMF gives thumbs up to Indonesia’s new monetary operating framework
Interest rate corridor and switch to new policy rate has improved monetary policy transmission, early data shows, but further reforms could strengthen framework further
Angola disregards IMF advice on exchange rate overhaul
Angolan authorities disagree with IMF over suggested exchange rate framework changes but agree to a banking sector clean-up
Kazakhstan’s Akishev sets sights on lower inflation
Governor hails success with inflation targeting and says central bank now plans to push inflation even lower; NBK also working on new banking supervision framework
Kenya’s monetary policy framework under threat – IMF
New interest rate caps are “constraining” the central bank’s ability to conduct monetary policy while negatively affecting banks’ profitability, but action plan could see them eliminated
Norges Bank defends policy framework amid government review
The government is assessing the central bank’s governance and monetary policy; Norges Bank says it needs a “long and flexible horizon” to be able to properly conduct its policy framework
Central Bank of Kenya halts reference rate calculation
Rate made redundant by interest cap, Njoroge explains, as banks prepare for the new arrangement; central bank maintains interest rates at 10%
Money targeting key to Egypt reform programme
Central bank to maintain flexible exchange rates and keep a close rein on the money supply as IMF pledges $12 billion support
Thai governor calls for rethink of monetary policy frameworks
New structure should systematically acknowledge the negative impact of monetary policy; Santiprabhob recognises macroprudential cannot take all the strain
Adopting inflation target can create higher inflation – paper
Bank of Korea working paper finds positive relationship between inflation target and inflation, implying some central banks may be tempted to move the goalposts