Inflation
Fed holds as near-term risks ‘diminish’
FOMC says near-term risks to US outlook have diminished, while economic activity is expanding at a “moderate pace”; keeps policy unchanged, but statement sees increasing odds of a hike this year
Jamaica’s monthly inflation turns positive
It increases to 0.2%, but annual inflation slides to 2.1%; Bank of Jamaica still confident that inflation will fall within the target range for 2016/17
Menon pledges tougher measures on AML controls in Singapore
Ravi Menon says central bank will conduct more intrusive probes of higher-risk institutions and take stronger actions where practices fall short; monetary policy likely on hold for 2016
Turkish central bank to meet with investors under new comms practices
Central Bank of the Republic of Turkey announces string of new communication practices that will see it meet with wider range of stakeholders
Inflation expectations are part of QE transmission mechanism – BoE paper
Firms’ inflation expectations increase in response to QE, research finds; interventions played ‘modest’ role in stabilising inflation expectations in recent years
Sarb hiking cycle is paused, not stopped, governor stresses
South African Reserve bank delays further tightening in wake of more favourable inflation outlook; governor insists it is a ‘pause’ and should expectations change the MPC would act appropriately
Growth risks push Mauritius MPC to cut by 40bp
Central bank cuts interest rates to 4%, amid risks arising from Brexit and potential volatility from US elections; reducing rate will support investment and encourage growth, says bank
Temporary price changes affecting inflation more – BoJ paper
Working paper explores how frequent micro-level price changes can be reconciled with macro-price stickiness; temporary price changes happening more, and increasingly in one direction, authors say
BoE’s Weale sees demand weakening more than supply
Martin Weale thinks short-term impact of UK vote more likely to drag on inflation than boost it; will also weigh impact of exchange rate movements and earnings developments in August meeting
RBNZ can evaluate forecasts using benchmarks – McDermott
Inflation has been weaker and the NZ dollar stronger than the central bank forecast, assistant governor says; can gain insight from comparing its forecast with others
BoE holds but MPC expects August easing
Pound appreciates as monetary policy committee votes 8:1 to leave rates at 0.5%; "most" committee members expect monetary stimulus in August
Argentine central bank holds rate on its bonds with eye on inflation
Reference rate held at 30.25% ahead of second inflation figure release; second monthly statistic from Indec due today, no official annual figure yet
Inflation expectations shaped by different forces in short and long term – BoE research
UK households are influenced by perceptions of actual inflation, but other factors grow in importance in the longer run, quarterly bulletin article finds
Sarb faces tough job amid ‘sobering’ outlook, IMF warns
Capital flows, sovereign rating and financial sector health form dangerous links, fund says, though South African authorities stress they have made preparations
US Phillips Curve “not broken” – IMF paper
Working paper finds economic behaviour since the crisis reflects different sources of disturbances, and not a change in the dynamics of the Phillips curve
Fed’s Tarullo looking for more evidence on inflation
Daniel Tarullo wants to see more convincing evidence that inflation is returning to target before tightening monetary policy; headline and core PCE inflation are still below target
Annual inflation in Argentina at 40.3% by year-end, markets say
Inflation seen slowing to less than 16% by end of 2018; results published in new expectations survey, relaunched after the central bank studied examples from abroad
Riksbank tweaks forward guidance, citing Brexit uncertainty
Swedish central bank says it will likely only raise the policy rate from the second half of 2017 onwards; highlights “considerable uncertainty” abroad
Sarb deputy sees reasons for ‘cautious optimism’
‘Green shoots of recovery’ are starting to show, says Groepe; several and more fundamental patterns suggest the economy is on the mend
Mexico hikes rates to stabilise peso depreciation
Bank of Mexico surprises markets with 50bp hike to stem currency depreciation; analysts see global risk factors contributing to exchange rate developments
Central bank should consider sticky-price inflation as target variable – paper
South African working paper argues central bank should consider sticky price inflation as target variable; sticky prices more persistent and less volatile
Reserve Bank of Malawi to improve monetary policy architecture
Bank moves towards fully fledged inflation targeting, embracing interest rate-based framework; IMF staff note importance of maintaining tight monetary policy
BoE seen shifting into easing mode
Many economists view Bank of England as likely to shift towards an easing bias, but the central bank may find itself with limited room for manoeuvre
Sarb sets out five-year strategy in annual report
Central bank outlines objectives to be achieved by 2020, including around reserves, inflation and counterfeiting; while governor praises progress of financial stability bill