Week 9 Flashcards
0
Q
What explicit inflation target does the Bank of England follow?
A
2%
1
Q
What do monetary policy goals address?
A
The central banks agendas
2
Q
What repo rate is the Bank of England currently targeting?
A
0.5%
3
Q
When did the federal reserve change it’s policy from an interest rate target to a money target?
A
70s
4
Q
Describe the speed of adjustment for monetary policy:
A
Faster to change than fiscal
Can quickly alter money supply or interest rate
But effects can take years to manifest
5
Q
What is monetary policy like in the UK?
A
If economy grows too fast, Bank of England reduces the money supply
6
Q
What does the effectiveness of monetary policy depend on?
A
The interest elacity of the demand for money
