Inflation
Solomon Islands research illuminates inflation sources in small islands
Working paper finds domestic factors are mainly behind inflation outcomes, with the exchange rate only having a temporary impact; economy takes around a year to bounce back from shocks
Expectations have variable impact, finds ECB paper
Working paper suggests there have been ‘significant changes’ in the degree to which expectations have driven unemployment, with a particularly large effect during 2008 financial crisis
Hellwig warns against expanding financial stability mandate too far
Martin Hellwig presents his thoughts on how to strike a balance between the macroeconomic and financial stability objectives of monetary policy
Wilkins sheds light on research into Bank of Canada regime
Senior deputy governor Carolyn Wilkins tells Central Banking how the Bank of Canada is preparing for the inflation-targeting renewal in 2016; sets out three research themes
Olsen: Norway needs lower labour costs
Norges Bank governor Øystein Olsen argues labour costs must be brought into line with those of Norway’s trading partners to support a rebalancing of the economy away from oil
IMF report urges review of euro timeline in Romania
Staff fear convergence could take longer than expected; encourage the transition to a ‘full-fledged’ inflation targeting regime at the central bank
Yellen sees potential benefits in ‘tight’ labour market
Fed chair Janet Yellen says allowing unemployment to fall below its longer-run level for a short time could help return inflation to target quicker and boost productivity
South African MPC member named deputy governor
Adviser to governor and MPC member Kuben Naidoo will assume post on April 1; central bank kept benchmark rate unchanged yesterday despite ‘deterioration’ in inflation outlook
Fed’s Evans harbours ‘serious concerns’ over inflation
Chicago Fed president wants to see stronger wage growth and a recovery in ‘long-term inflation compensation’ demanded by investors before sanctioning rate hike
UK inflation hits zero
For the first time ever, consumer prices were unchanged in the year to February, although the 0% figure masks substantial variation among sectors; BoE hints at easing possibility
Forward guidance can help QE succeed, Finnish research says
Article in Bank of Finland bulletin considers whether eurozone is at risk of Japanese-style deflation, finding the ECB’s asset purchases reduce the odds of this outcome
Central banks told to handle financial inclusion with care
Greater inclusion benefits the poor but could damage monetary policy or financial stability if it is not kept under control, BIS research and IMF officials warn
Kuroda says QQE bringing ‘landmark’ changes to Japan
BoJ governor sets out evidence that extraordinary monetary easing is bearing fruit, with inflation expectations rising and workers demanding higher wages
ECB forecasts ‘gradual’ increase in US inflation
Economic bulletin published by ECB agrees with FOMC that inflation will increase gradually as labour market conditions improve and impact of low oil prices and high dollar fades
Haldane warns expectations could drag down wages
Lower inflation expectations putting downward pressure on wages, and could contribute to greater persistence of low or falling inflation, BoE chief economist says
Fed keeps options open as countdown to lift-off begins
FOMC drops the reference to being ‘patient’ before normalising policy, signalling a rate hike could arrive as early as June, but tempers expectations with more cautious economic assessment
IMF paper warns against ‘overburdening’ LatAm central banks
Working paper studies evolution of central banks in Latin America, and warns against jeopardising the credibility they currently enjoy by handing them new mandates
BoJ’s easing boosts inequality, warns IMF paper
Working paper finds attempts to meet Japan’s 2% inflation target are increasing income growth and inequality; calls for structural reform to make this growth more inclusive
IMF paper sees lower inflation boosting Indian savings
Working paper says a ‘sustained reduction in inflation’ would help create interest rate environment necessary to boost corporate profitability and encourage household savings
Central Bank of Brazil sees inflation gathering pace
Progress made in the fight against inflation is not yet ‘sufficient’, according to minutes from monetary policy committee meeting last week
Carney confident of returning inflation to target in two years
BoE governor sees risk that global low inflation and strength of UK currency could weigh on prices for ‘some time’, but is confident the central bank is ‘on track’ for 2% inflation
ECB paper models Philips curve from professional forecasts
Working paper finds the curve consistent with professional forecasts has flattened since the financial crisis, with the relationship between inflation and unemployment weakening
McCafferty: BoE is right to look through oil price decline
The sharp fall of oil prices will have a temporary impact on inflation, since ‘supply rather than demand has been the dominant factor’, says McCafferty
BoJ’s Shirai: households sceptical of need for 2% inflation
Board member says better communication needed to explain to cash-strapped households why 2% inflation will be good for them in the long run