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Did central banks get the inflation crisis right?
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The US Federal Reserve, Bank of England, and European Central Bank have begun cutting rates after high inflation; uncertainty remains about the extent of these cuts. Donald Trump criticized the Federal Reserve's recent interest rate cut. Historical analysis shows that of 42 rate-raising cycles since the 1950s, those leading to recessions outnumber those that do not by two to one. Christine Lagarde, ECB president, noted that historic events have altered economic structures, complicating monetary policy assessments. Economists previously expected a deep recession from dramatic rate increases, according to Piet Haines Christiansen of Danske Bank. Central banks are now questioning the 'neutral' level of interest rates, which neither burdens nor stimulates the economy.
#CentralBanks #Inflation #InterestRates #MonetaryPolicy #EconomicDownturn #Recession #Ecb #FederalReserve #BankOfEngland #GlobalEconomy
https://www.ft.com/content/b003ab08-70d8-4098-b1ec-09fd9af4bf17 nostr.fmt.wiz.biz
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The US Federal Reserve, Bank of England, and European Central Bank have begun cutting rates after high inflation; uncertainty remains about the extent of these cuts. Donald Trump criticized the Federal Reserve's recent interest rate cut. Historical analysis shows that of 42 rate-raising cycles since the 1950s, those leading to recessions outnumber those that do not by two to one. Christine Lagarde, ECB president, noted that historic events have altered economic structures, complicating monetary policy assessments. Economists previously expected a deep recession from dramatic rate increases, according to Piet Haines Christiansen of Danske Bank. Central banks are now questioning the 'neutral' level of interest rates, which neither burdens nor stimulates the economy.
#CentralBanks #Inflation #InterestRates #MonetaryPolicy #EconomicDownturn #Recession #Ecb #FederalReserve #BankOfEngland #GlobalEconomy
https://www.ft.com/content/b003ab08-70d8-4098-b1ec-09fd9af4bf17 nostr.fmt.wiz.biz