Not sure a central bank can really influence productivity - and even if it could it would have a ton a lag in the system, meaning a higher degree of instability. The more complex a system the more chaos in said system.
Why the Bank of England Should Target Growth
The Bank of England raised interest rates to 0.75% this month, in the belief that inflation will exceed its mandated 2% target in about two years. But raising interest rates tends to dampen economic activity, and growth is hardly rampaging in the United Kingdom. Should the BoE consider a change to its mandate to include economic growth? In the United States, the Federal Reserve has a dual mandate: price stability and maximum employment. Of course, the Fed has also raised interest rates this year; but the US economy is growing at over 4% and GDP is expected to be around 3% higher this year. By contrast, the UK economy grew just 0.2% in ... (full story)
- Posted: Aug 10, 2018 2:07pm
- Submitted by:Category: Fundamental AnalysisComments: 2 / Views: 1,022