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Financial Economics & Central Banking

Financial Economics & Central Banking latest publications

October 7, 2022

Peru | BCRP increases rate and takes the policy stance to a restrictive level

The Board of the Central Bank decided to increase the monetary policy rate from 6.75% to 7.00% in October. The Bank tightened the monetary policy stance understood as the real ex-ante policy rate to a restrictive level.
  • Geography Tags
  • Peru

October 3, 2022

Global | A mild recession

The recession facing Europe and the United States, if not more countries, over the coming quarters is likely to be a quieter affair than other, deeper recessions seen in recent times. Ultimately, the current distortions within the economy are not as significant as in previous crises.

September 22, 2022

US | Hawkish 75bp fed funds rate hike signals a higher peak for rates

The updated “dot plot” reinforces the Fed’s “higher rates for longer” approach to bring inflation down to 2%. Another 75bp hike is now more likely than not in November and rates will likely go higher than previously thought.

September 20, 2022

US | Fed will deliver a third 75bp hike and back up hawkishness with updated projections

The Summary of Economic Projections (SEP) will point to less confidence in the soft-landing outcome and a challenging road to bring back inflation to below 3.0% levels as the Fed “keeps at it until the job is done”.

September 16, 2022

China | Estimating the optimal level of the country's foreign reserves

We estimate China’s optimal foreign reserve level is around USD 2,769.3 billion, USD 454.5 billion lower than the current level. That means, there is still some buffer to reduce the reserve amid risks of western potential sanctions.

September 13, 2022

US | Treasury yields resumed their bearish trend after Powell’s tough talk on inflation

Persistent core inflation coupled with a resilient economy give the Fed “flexibility to be aggressive” against inflation. Another supersized rate increase (75 bps) is coming next week: the Fed will continue to front load rate hikes to add 150bp of tightening by December before shifting to a relatively long pause thereafter.

September 12, 2022

Europe | Energy ECB

For the second time in a row, the ECB has struck with aggressive rate hikes, this time by 75 basis points. A magnitude more or less pre-announced in the last few days, when in July the expectation was increasing by 50.

September 9, 2022

Peru | BCRP reduces the pace of monetary adjustment: is this the end of the hiking cycle?

The Board of the Central Bank decided to increase the monetary policy rate from 6.50% to 6.75% in September. The Bank tightened the monetary policy stance understood as the real ex-ante policy rate to a level slightly above neutral.
  • Geography Tags
  • Peru