Nominal
in sentence
688 examples of Nominal in a sentence
Summers emphasizes the inadequacy of aggregate demand, exacerbated by the inability of central banks to reduce
nominal
interest rates below zero.
In 2012, the growth rate of M2 was about 14%, relatively low by historical standards, but still significantly higher than the
nominal
GDP growth rate.
The current small difference between the real interest rate on such bonds (2.1% for 30-year bonds) and the
nominal
interest rate on conventional 30-year Treasury bonds (now 4.6%) implies that the market expects only about 2.5% inflation over the next three decades.
High public-sector debt, for example, signals the possible need for tax increases – the opposite of the tax legislation being advanced by Republican legislators in the United States – and/or higher interest rates (real or nominal, depending on monetary policy and inflation).
In the 1970s, the economist Rudi Dornbusch (and reality) taught us that that was wrong: a floating-rate regime capitalizes expected future differences in
nominal
interest rates minus inflation rates into today’s exchange rate.
The fact that the eurozone lacked the labor-market flexibility needed to make it an optimal currency area meant that adjustment via regional reallocation of economic activity would be glacial, while its members’ loss of control over monetary policy ruled out adjustment via
nominal
depreciation.
By shifting its monetary-policy regime to target 4% annual inflation – or 6% annual
nominal
GDP growth – the US would set in motion rapid rebalancing in the eurozone.
As a result, the average
nominal
minimum wage in China nearly doubled between 2011 and 2018, and wages for workers in state-owned enterprises rose even faster.
Economists today know a great deal more – albeit not as much as we would like – about how monetary, banking, and fiscal policies affect the flow of
nominal
spending, and their findings are the topic of a great deal of open and deep political and public intellectual discussion.
Why are the principles of
nominal
income determination, which I thought largely settled since 1829, now being questioned?
It is now clear that the right-wing opponents to the Obama administration’s policies are not objecting to the use of fiscal measures to stabilize
nominal
spending.
The working classes can vote, economists understand and publicly discuss
nominal
income determination, and no influential group stands to benefit from a deeper and more prolonged depression.
In
nominal
terms, Italian and Spanish borrowing costs are indeed comparable to the levels of the late 1990’s.
If that causes a rise in the departing country’s price level, the
nominal
exchange rate would have to decline further to achieve the same real adjustment.
These include emerging markets’ long-term growth differentials relative to advanced economies; investors’ greater willingness to diversify beyond their home markets; and the expectation of long-term
nominal
and real appreciation of emerging-market currencies.
As for the first observation, total US exports and imports of goods and services relative to
nominal
GDP (the standard international measure of openness to trade) currently stands at close to 30%.
As a result, though total credit in China continues to grow three times faster than
nominal
GDP, a major downturn is now underway.
Second, the effects of austerity were exacerbated by the choice to pursue nominal, rather than structural, fiscal-deficit targets.
The Fed’s 25-basis-point cut in December was puny relative to what is needed; similar cuts by the Bank of England and Bank of Canada do not even begin to address the increase in
nominal
and real borrowing rates that the sharp rise in Libor rates has induced.
The problem with monetary policy is that, in responding to today’s crisis, the world’s central banks have bought so many safe government bonds for so much cash that the price of safe wealth in the near future is absolutely flat – the
nominal
interest rate on government securities is zero.
Greece’s
nominal
debt stock will matter only once the country re-enters the debt markets and becomes subject to market, not concessional, borrowing terms.
In the meantime, Greece must implement the structural reforms needed to restore the country’s long-term growth prospects and thus to strengthen its capacity to repay its creditors without a large
nominal
debt reduction.
But in a world of low inflation and zero
nominal
interest rates, getting to the required negative real rate may be a challenge.
China’s inflation has been higher than the average of its trading partners, and the renminbi has in fact strengthened gradually in
nominal
terms.
There are also some who believe that the eurozone’s fiscal and monetary framework locks Italy into weak
nominal
GDP growth, possibly too-low inflation, and high debt.
Still, the mainstream political parties that governed Italy until this year did not deliver the
nominal
GDP growth that the country needs.
At this stage, Italy needs stronger
nominal
GDP growth – plain and simple.
We may be in a permanent liquidity trap, in which
nominal
interest rates cannot fall below zero, but the expected rate of return to investment remains negative.
To maintain growth, they need a
nominal
and real depreciation of their currency to reduce their trade deficits.
But over-saving countries – such as China, Japan, and Germany – that were running current-account surpluses are resisting their currencies’
nominal
appreciation.
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