EconReporter

In a recent research, four European Central Bank economists found that negative interest rate policy in the eurozone can encourage banks to increase lending and encourage cooperations to increase investments. That is, contrary to what macroeconomics models usually predict, interest rate policy can still has stimulative effect even the zero lower bound is reached.

Ricardo Reis, economics professor at the London School of Economics, explained that there were telling signs that the increase in cost of living started ealry-2021 was not a "transitory" phenomenon.

In a recent IMF working paper "Overfitting in Judgment-based Economic Forecasts: The Case of IMF Growth Projections", economist Klaus-Peter Hellwig examined IMF's World Economic Forecasts (WEO) and check if the forecast model suffer from the problem of overfitting.

"The [Standing Repo Facility (SRF)] rate is set at the top of the FOMC’s target range for the federal funds rate. This combination of an ample supply of reserves and an SRF rate at the top of the target range reduces the day-to-day reliance on the facility except during periods of significant upward pressure on rates resulting from strong liquidity demand or market stress," said John Williams

Federal Reserve decided to cut rate by an supersized 0.5 percentage point. The decision finally ended the weeks-long market debate of whether the central bank would cut 25 or 50 basis points. One important thing, though, didn't reach the headline: The Fed has never been this "confused" about where the natural rate should be.

HKD tends to be on the strong side (closer to HKD 7.75 per USD) when the interest rate differential is positive (HIBOR > LIBOR).

In recent months, the Global Economic Policy Uncertainty index has risen to a level much higher than periods around the 911 Terrorist Attack or the 2008 Financial Crisis, hence the conclusion that the economic policy is unprecedently uncertain now. But here is why you might not have to worry.

The payment on reserve process proposed by Robert Hall and Ricardo Reis is a way of remunerating reserves which would give the central bank...

The Fed has changed it interest rate policy regime since 2008, from the so-called Corridor system, to the Floor system it is using right now. What is the different?

Countries with swap line arrangement with Federal Reserve, be it the standing ones or temporary, saw smaller increases in spread during the initial pandemic stress period.