Monetary Policy Roundtable

What was the influence of the divergence between US and euro-area monetary policy? A particular concern at the time of the Roundtable was whether the widespread decline in asset prices was suggestive of a material slowdown in future global growth. Asset prices also affect business investment via the...

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Bibliographic Details
Published in:Bank of England quarterly bulletin 2016-04, Vol.56 (2), p.117-119
Format: Article
Language:English
Subjects:
Balance sheets
Banks
Central banks
Currency
Discount rates
Economic models
Equity
Inflation
Inflation rates
International finance
Investments
Macroeconomics
Monetary policy
Securities markets
Securities prices
United Kingdom
Volatility
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Summary:What was the influence of the divergence between US and euro-area monetary policy? A particular concern at the time of the Roundtable was whether the widespread decline in asset prices was suggestive of a material slowdown in future global growth. Asset prices also affect business investment via the cost of capital as well as stock market volatility. More generally, the increased uncertainty about policy, divergence of the cycle or policy stance among major countries, and the use of unconventional policy tools that make central banks active players in asset markets, all directly affect risk appetite and propagate the GFC.
ISSN:0005-5166
2399-4568