Monetary
in sentence
5081 examples of Monetary in a sentence
Europe needs a grand bargain, involving close coordination on structural reforms and fiscal and
monetary
policy.
As Trump launches his policies, however, the Fed is likely to tighten its
monetary
policy more than it had planned before the inauguration, not less, as the markets still expect.
The only uncertainty is how
monetary
policy will respond to this “Trumpflation.”
In Europe and Japan, by contrast,
monetary
conditions will remain loose, as central banks continue to support economic growth with zero interest rates and quantitative easing (QE).
Given that it is less controversial than unconventional
monetary
policies, and will take longer to produce results, it should be given top priority.
Though the policy succeeded in buttressing China’s economic growth, it was widely criticized as an overreaction – one that led to excessive
monetary
expansion.
In particular, members of Europe’s economic and
monetary
union should give up their seats in the G-7 and the International
Monetary
Fund.
This is a poor showing for countries that successfully confronted the challenges of creating the EU and
monetary
union.
Meanwhile, France, Germany, and Italy are all in the G-7, even though they share the same
monetary
policy and currency.
Indeed, the ECB’s own forecast has inflation falling in the second half of 2012 and again in 2013, suggesting that it has
monetary
room for maneuver.
In its view, rewarding them with
monetary
stimulus – keeping the boat afloat with more spending – only relieves the pressure on national officials to do what is necessary.
The ECB will object, not without reason, that
monetary
policy is a blunt instrument with which to rebalance the European economy.
Policymakers should remember that the housing boom was fueled by easy
monetary
policy, which sought to expand job growth as the US recovered from the last recession.
So German leaders concluded that they had to share their country’s dominating position in
monetary
policies with others.
And it should not come as a surprise that the markets have tested the willingness of European political leaders to keep quiet where
monetary
affairs are concerned.
It may come as a shock to non-economists, but banks play no role in the standard economic model that
monetary
policymakers have used for the last couple of decades.
Of course, even in the best of circumstances,
monetary
policy’s ability to restore a slumping economy to full employment may be limited.
What is the immediate and longer-term outlook for US
monetary
policy?
The Fed’s leaders have repeatedly said that they plan to raise interest rates much more slowly than in previous periods of
monetary
tightening.
In a related argument, Barry Eichengreen, the Berkeley economic historian, suggests that US
monetary
policy is now effectively “Made in China,” because China’s efforts to stabilize the renminbi have already tightened US
monetary
conditions by the equivalent of the quarter-point rate hike expected on December 16.
In a similar vein, Stephen S. Roach, former chief economist of Morgan Stanley, argues that the Fed has already made a “fatal mistake” by keeping interest rates so low for so long, thereby transforming
monetary
policy “from an agent of price stability into an engine of financial instability.”
On balance, considering that the Fed is under fire from both directions, perhaps a modest tightening of
monetary
policy is about right, says former IMF chief economist Kenneth Rogoff.
The real risk of
monetary
tightening, he suggests, is political: “If the Fed starts hiking, it will be blamed for absolutely every bad thing that happens in the economy for the next six months to a year, which will happen to coincide with the heart of a US presidential election campaign.”
The sense that
monetary
policy is starting to normalize will help to reassure investors and businesses, thereby dispelling lingering memories of the 2008 financial crisis.
The key problem, says Jose Antonio Ocampo, former UN Under-Secretary for Economic Affairs, is the dollar’s dominant reserve-currency status, which means that
monetary
policy in emerging economies is overly influenced by the US.
Almost all of these commentators agree that
monetary
policy should focus on economic growth, not financial stability (tougher regulation is needed to achieve that).
Davies disagrees, as do Shiller and Roach, but they fail to explain how growth can be accelerated if
monetary
policy is tightened to avoid credit bubbles.
Meanwhile, economists who believe that further
monetary
loosening is required to pull the world out of stagnation must look elsewhere.
They can pin their hopes on China, where
monetary
policy will become more expansionary, according to Fudan University’s Zhang Jun, or on Europe, where the European Central Bank is providing increasingly powerful stimulus as
monetary
union evolves into a “deeper political union,” according to ECB President Mario Draghi.
Koichi Hamada, chief economic adviser to Prime Minister Shinzo Abe, provides a reminder that seems all the more relevant as the US experiment comes to a close: “The belief that
monetary
policy does not matter is the most dangerous idea in economic history.”
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