Report
Patrick Artus

Are central banks once again taking orders from governments?

Since the 1980s, central banks have chosen an inflation targeting policy and have also become independent of governments . But is that still the case now ? Are central banks once again taking orders from governments ? Adm ittedly , the Federal Reserve and the ECB have stopped quantitative easing, but these programmes had in reality become pointless as long-term interest rates had become very low. But we have seen: Abnormal stimulation of activity, with very low interest rates despite full employment (United States, euro zone, Japan); A presumption of support for government fiscal solvency, ensured by low interest rates and falling interest payments on public debt (United States, euro zone excluding Germany, Japan). So it is not abnormal to que stion whether central banks in this way are try ing to please governments while, admittedly, benefiting from the low level of core inflation.
Provider
Natixis
Natixis

Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.

 

Analysts
Patrick Artus

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