This event is co-organised by Bruegel and the Kobe University Graduate School of Economics.
Speech by Benoît Cœuré, Member of the Executive Board of the ECB, at an event organised by Bruegel, Brussels, 31 March 2017
This paper applies the info-gap approach to the unconventional monetary policy of the Eurosystem and so takes into account the fundamental uncertainty on inflation shocks and the transmission mechanism.
For the last few years, Japanese banks have aggressively expanded their assets overseas, which has helped increased their stubbornly low profitability even after the introduction of negative interest rates by BoJ. Such a successful overseas strategy, profitability-wise, may be at risk due to US$ liquidity developments at a global level.
Yields on European sovereign bonds have reached historically low levels in 2016. This secular decline in long-term sovereign yields is not limited to the euro area. Why are interest rates currently so low? Are low long-term trates justified by fundamental factors or is it an artificial phenomenon?
What’s at stake: This week saw two important Central Banks’ meetings, whose outcomes could hardly be more different. While the U.S. Federal Reserve left interest rates unchanged, the Bank of Japan introduced a big shift in its easing framework. BOJ committed itself to overshoot its inflation target of 2 percent, and introduced a targeting of the yield on ten-year Japanese government debt, initially at about zero percent. We review the economic blogosphere reaction to this latest monetary policy action.
What’s at stake: this year’s edition of the Jackson Hole symposium was awaited as an occasion to discuss how to redesign monetary policy for the future. We documented the state of academic and policymaking discussion on the topic in a previous review. But it seems the meeting has left many with the impression the Fed is not yet ready to start “rethinking normality”.
What’s at stake: As we approach Jackson Hole, monetary policymakers are considering how to redesign monetary policy strategies to better cope with a low r-star environment.
Many in the EU look to the USA as a model for monetary union in the Eurozone. But how easy was it to create such a union, and what can Europe learn from the USA’s experience?
After a sharp increase in corporate bond issuance following the ECB’s announcement in March this year, corporates continue to respond to the Corporate Sector Purchase Program.
We have observed a sharp increase in corporate bond issuance following the ECB’s announcement in March this year, but it is too early to see the effects on investment by non-financial corporations.
Both the Fed and the ECB have managed to remain credible since the financial crisis, but their credibility levels have evolved differently. Since inflation in the US and the euro area has been similar in the past 8 years, the difference in the way that credibility has evolved is the result of the different macroeconomic policy mix applied.