
Bank CEOs should be forced to have a framed version of this image on their desks. https://t.co/MT7pXzpCRN
Bank CEOs should be forced to have a framed version of this image on their desks. https://t.co/MT7pXzpCRN
As such, the expected path of the short rate can have significant, meaningful effects on the repricing of securities nearly immediately, while the level of the policy rate works through the economy over time.
Today, interest rates are exceptionally low and the growth outlook for advanced economies is modest at best. This leads us to conclude that the question is when markets will start putting pressure on governments, not if.
And also to improve the timeliness of their signals. This is done by a closer monitoring of commodity prices more directly tied to the economy.