Not exact matches
«If we were to try to
control the level of our exchange
rate, we would have to start to close what is one of the most open and effective capital
markets,
money markets, in the world, in order to be successful,» Carney told a parliamentary committee this month, also warning «there would undoubtedly be a suspicion» that we were «trying to gain a competitive advantage» if we tried to
control our interest
rate.
A number of operational features were required to implement such an overnight reverse repo, or ON RRP, facility: It would need same - day settlement; 16 the operation would need to be run predictably, every day, and as late in the day as possible, to give lenders time to bargain with other counterparties using the outside option of investing with the Federal Reserve; 17 an appropriate spread below IOR would be required to ensure that the facility neither induced large changes in the structure of
money markets nor lost the ability to support interest
rate control; 18 and the operations would need enough unused capacity that lenders could credibly propose to leave borrowers that did not offer an adequate interest
rate.19
If policymakers had chosen to do so, the Federal Reserve could have made such a term reserve draining approach work to help
control money market rates in the United States.15
To «hike
rates» the Fed Open
Market Committee (FOMC) must use its power to diminish the economy's quantity of spending
money through its
control over the Monetary Base (MB), which is the accounted sum of the monetary obligations of the 12 Fed Banks.
in addition, the Federal Reserve will be able to employ other tools, such as fixed -
rate overnight reverse repurchase agreements, term deposits, or term repurchase agreements, to drain bank reserves and tighten its
control over
money market rates if this proves necessary.
Macleod argues that the correlation would remain valid in free
markets but has been nullified by the destruction by central banks of free
markets for
money, the seizure by central banks of
control over interest
rates, which are no longer set by savers and borrowers.
The introduction of
money market funds (and the elimination of regulation Q, a ceiling on credited interest
rates) helped prolong the inflation of the 70s, because the Fed couldn't
control liquidity the way that it used to;
money market funds just kept supplying liquidity at interest
rates investors found attractive.
Granted, the
rate was above the expected fed funds
rate for the next month, but using that as a guideline is tantamount to surrendering
control of the
money supply to the Fed Funds futures
market.
Monetary Policy: The techniques used by a monetary authority (such as the Bank of Canada or the Federal Reserve) to
control the supply of
money in a given currency, typically with the goal of manipulating either inflation or
market interest
rates.
Monetary Authority: The entity which
controls the
money supply in a given currency, typically with the goal of manipulating either inflation or
market interest
rates.
That's because the big factors moving the country's hottest
markets are largely beyond its
control — rock - bottom interest
rates, an influx of Chinese
money and a scarcity of single - family houses in cities such as Toronto and Vancouver.
Ryan discusses the death of Osama Bin Laden; Ryan reviews the economic news of the week; Ryan notices the correlation between increased home sales and interest
rate drops; Louis notes we can't expect the housing
market to be supported by further decreases in
rates as they are already near historic lows; Ryan explains that interest
rates change once every four hours; Ryan notes the difference between getting a quote and being locked in to an interest
rate; Ryan advises the importance of keeping in touch with your mortgage lender; Louis notes that interest
rates change a lot faster than home prices; Ryan notes that the consumer confidence was up, Ryan and Louis discuss the Fed's decision to keep interest
rates where they are and to continue the $ 600 billion QE2 program; Ryan and Louis discuss the Fed's view that inflation is nascent; Louis notes that not only does the Fed not see inflation that exists but disclaims any responsibility for it; Louis asserts that there is a correlation between oil prices and Fed policy; Louis discusses Ben Bernanke's assertion that the Fed can't
control oil prices but that they somehow can
control the impact of higher oil prices on the rest of the economy; Louis also remarks on Bernanke's view of the dollar - the claim that a strong dollar can be achieved through the Fed's current policy as it is their belief that they are creating a sound economy and therefore a sound dollar; Louis notes the irony of the Fed chastising Congress» spendthrift ways — if the Fed did not monetize the debt, Congress could» nt spend; Louis noted that as Bernanke spoke the prices of gold and silver rose as it seemed that the Fed has no interest in cutting off the easy
money; the current Fed policy will keep interest
rates low; Ryan notes that the Fed knows that they can't let interest
rates rise because of the housing mess; Louis notes that the Fed has a Hobson's Choice - either keep
rates low or let interest
rates rise and cut off the recovery.