Monetary and prudential policies at a crossroads?

The BIS Working Paper "Monetary and prudential policies at a crossroads? New challenges in the new century" argues that financial liberalisation has resulted in subtle but profound changes in the dynamics of the economy and in the challenges faced by policymakers.

It is hard to find a period in the post-war era in which inflation-adjusted interest rates have been so low for so long and monetary and credit aggregates have expanded so much without igniting inflation (the "Great Liquidity Expansion

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