Monthly Archives: September 2015

Discussion 2 of Ajello, Laubach, López-Salido, and Nakata, “Financial stability and optimal interest-rate policy”

A second discussion (slides) of the paper “Financial Stability and Optimal Interest-Rate Policy” by Andrea Ajello, Thomas Laubach, David López-Salido, and Taisuke Nakata, Federal Reserve Board, at the conference “Monetary Policy Lessons from the Financial Crisis,” Swiss National Bank Research Conference, September 24-26, 2015.
A previous (and different) discussion of this paper is here.

IMF: Monetary policy should focus on price stability

Monetary policy should stick to its core mandate of price stability, and should deviate from its traditional role only if the benefits to the economy outweigh the costs, according to a new study from the International Monetary Fund, “Monetary Policy and Financial Stability.”

The question is whether monetary policy should be altered to contain financial stability risks. Should it lend a hand by temporarily raising interest rates more than warranted by price and output stability objectives?

Based on our current knowledge, and in present circumstances, the answer is generally no.

Discussion of “Inflation targeting does not anchor inflation expectations”

Discussion (text) of “Inflation targeting does not anchor inflation expectations: Evidence from firms in New Zeland” by Saten Kumar, Hassan Afrouzi, Olivier Coibion, and Yuriy Gorodnichenko at the Fall 2015 Brookings Panel on Economic Activity, Washington, DC, September 10-11, 2015. Published in Brookings Papers on Economic Activity, Fall 2015, 212-219.