Sunday , September 22 2019
Home / Tag Archives: Central Banks (page 3)

Tag Archives: Central Banks

Incrementum Inflation Signal Update – A Reversal To “Rising Inflation”

    Introductory Remarks by PT We have discussed the proprietary Incrementum Inflation Indicator in these pages on previous occasions, but want to quickly summarize its salient features again. It is a purely market-based indicator, this is to say, its calculation is based exclusively on market prices and price ratios derived from market prices. However, contrary to most measures of inflation expectations, the Incrementum Inflation Signal...

Read More »

The Real or Imagined Third Fed Mandate – Precious Metals Supply and Demand

  Fundamental Developments – Silver Looking Frisky The price of gold went up four bucks, and the price of silver rose 32 cents. Silver has been going up in gold terms since the middle of last week, when the gold-silver ratio peaked at just under 87. It closed this week at just under 82 (a lower ratio means silver is more valuable). Silver: more valuable since last week, both in absolute and relative terms. Just avoid dropping it on...

Read More »

Circling the Drain

    Drain, drain, drain… “Master!”, cried the punters, “we urgently need rain! We can no longer bear this unprecedented pain!” “I’m sorry my dear children, you beg for rain in vain. It is I who is in charge now and mine’s the put-less reign. The bubble dragon shall be slain, by me, the bubble bane. That rustling sound? That’s me… as I drain and drain and drain.” [ed note: cue evil laughter with lots of giant cave reverb] – a public...

Read More »

The Stock Market on FOMC Day – Buy or Sell the News?

  The Seasonal Trend Inversion Continues By now it has been pretty well telegraphed that the Fed will likely announce that it is going to end its “automatic 25 bps rate hike every quarter” policy and replace it with some sort of “incoming data dependent” version. Normally one would expect this to constitute a “buy the news” event, especially in view of the recent sharp decline in the stock market. However, there are still a few problems...

Read More »

Forecast errors and monetary policy normalisation in the euro area

What did we learn from the recent monetary policy normalisation experiences of Sweden, the United States and the United Kingdom? Zsolt Darvas consider the lessons and analyse the European Central Bank’s forecasting track record and possible factors that might explain the forecast errors. By: Zsolt Darvas Date: December 13, 2018 Topic: European Macroeconomics & Governance This Policy Contribution was prepared for the...

Read More »

Deep Focus: Consequences of European Central Bank forecasting errors

Bruegel senior scholar Zsolt Darvas speaks about his review of systematic errors in ECB forecasting, in another instalment of the Deep Focus podcast on 'The Sound of Economics' channel In this episode of the Deep Focus, Sean Gibson speaks with Bruegel senior scholar Zsolt Darvas about his research on European Central Bank forecasting. Zsolt has analysed that, over the past five years, ECB forecasts have proven to be systematically incorrect: core inflation remained broadly stable at 1%...

Read More »

The Big Picture: Paper Money vs. Gold

  Numbers from Bizarro-World The past few months have been really challenging for anyone invested in gold or silver; for me personally as well. Despite serious warning signs in the economy, staggering debt levels and a multitude of significant geopolitical threats at play, the rally in risk assets seemed to continue unabated. Bizarro-World intrudes into our reality, courtesy of central banks. [PT] In fact, I was struggling with this...

Read More »

A Global Dearth of Liquidity

  Worldwide Liquidity Drought – Money Supply Growth Slows Everywhere This is a brief update on money supply growth trends in the most important currency areas outside the US (namely the euro area, Japan and China)  as announced in in our recent update on US money supply growth (see “Federal Punch Bowl Removal Agency” for the details). Nobody likes a drought. This collage illustrates why. The liquidity drought is not confined to the...

Read More »

ECB’s huge forecasting errors undermine credibility of current forecasts

In the past five years ECB forecasts have proven to be systematically incorrect: core inflation remained broadly stable at 1% despite the stubbornly predicted increase, while the unemployment rate fell faster than predicted. Such forecast errors, which are also inconsistent with each other, raise serious doubts about the reliability of the ECB’s current forecast of accelerating core inflation and necessitates a reflection on the inflation aim of the ECB. By: Zsolt Darvas Date:...

Read More »

Green central banking

A few weeks ago, Silvia Merler discussed the rise of “ethical investing”. A related question emerging from the discussion is whether central banks should also “go green”. Silvia reviews the latest developments and opinions on this topic. A UN report published last year looked in detail at the role of central banks in enhancing green finance. Given the enormous investments needed to bring about a green transformation, the financial sector will have to play a central role in allocating...

Read More »