Willem Buiter, 18 July 2008

Willem Buiter talks to Romesh Vaitilingam about the financial crisis, the global cyclical slowdown and the rise of inflation. He discusses central banks’ responses to the credit crunch and calls on them to tighten monetary policy to counter the inflationary threat.

Daron Acemoğlu, Simon Johnson, James Robinson, Pablo Querubin, 25 June 2008

Central bank independence can have marvellous effects on inflation, but not always. This column reviews evidence of a U-shaped interaction between policy reform and general political institutions; independence can be undermined in nations with poor political institutions, while it is less necessary in nations with excellent institutions. A ‘seesaw’ effect is also identified whereby fiscal policy deteriorates following central bank independence.

Guido Tabellini, 23 June 2008

The ECB and the Fed are pursuing very different policies on inflation fighting and the use of monetary aggregates in guiding policy. One of Italy’s leading economists argues that either the ECB or the Fed is making a mistake.

Barry Eichengreen, 19 June 2008

With the world on the brink of a recession and the US exporting inflation, Asian macro policies are seriously misaligned. Here one of the world’s leading international economists argues that Asia needs tight money, appreciated exchange rates, and fiscal stimulus.

Guillermo Calvo, 20 June 2008

Here, one of the world’s leading macroeconomists argues that the explosion of commodity prices is the result of a very real global financial storm associated with excess liquidity in several non-G7 countries and nourished by the low interest rates set by G7 central banks. The commodity price explosion is a harbinger of future inflation.

Raphael Auer, Andreas Fischer, 13 June 2008

Research using a novel empirical technique suggests that import competition from low-wage countries dampens US producer price inflation for manufactured goods by more than 2 percentage points annually.

Petra Geraats, Francesco Giavazzi, Charles Wyplosz, 07 February 2008

The latest Monitoring the European Central Bank Report argues that the ECB has a serious credibility and communication problem: the way the Governing Council makes its interest rate decisions remains clouded.

Carmen Reinhart, 05 May 2010

This column, first posted 19 April 2008, argues that sovereign debt crises have historically followed financial crises. Although data covering only the last thirty years might have given few hints about Greece's current problems, the Reinhart-Rogoff database spanning eight centuries reveals that today's event are very much in line with historical experience.

Tommaso Monacelli, 20 March 2008

Inflation is rising. This column identifies three sources of inflation and argues that it is very important for central banks to tame inflation now, before we face a vicious cycle of rising inflation and expected inflation.

Samuel Bentolila, Juan Dolado, Juan F Jimeno, 12 January 2008

Spain’s inflation-less drop in unemployment is due in large part to its immigration boom. If immigrants’ labour-supply behaviour comes closer to that of natives and inflation remains above target, a deeper slowdown or increasing immigration flows will be needed to bring it down.

Charles Goodhart, 24 September 2007

Recent research suggests that the additional predictive power of the yield curve – beyond the information in other macroeconomic variables – often appeared during periods of uncertainty about the underlying monetary regime. This is true, for example, of the US during the Volcker disinflation episode.

Axel Leijonhufvud, 25 June 2007

An expansionary monetary policy and an historical conjuncture that happens to produce no inflation will lead to asset price inflation and deterioration of credit. At some stage, central banks will have to mop the liquidity or see inflation do it for them.

Michael Woodford, 26 March 2007

Should money supply play a role in monetary policy-making? The author of CEPR DP6211 reviews the pros and cons and finds that there are no compelling reasons to assign a prominent role to monetary aggregates in monetary policy-making. The goals of the ECB's two-pillar strategy - which includes a role for money - are praiseworthy; the author believes that ECB justifications for looking at monetary aggregates provide little support for this approach.

Stephen Cecchetti, 01 July 2006

Inflation targeting is best practice in 21st-century monetary policymaking. With some of its key academic proponents – Messrs. Bernanke and Mishkin – at the US Fed, there is some hope that the US will join the ranks of explicit inflation targeters.

Stephen Cecchetti, 01 March 2007

Written March 2007: Many central banks focus on core inflation; this is a mistake. Excluding food and energy items imparts a bias to medium-term measures of inflation. Since the goal of policymakers is stable prices overall, including those of food and energy, they should turn their attention to forecasts of headline inflation and stop focusing on core measures.

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