Financial Innovation, Monetary Aggregates and Monetary Policy in the UK and Germany
The UK monetary authorities abandoned broad money targeting in the mid 1980s because they feit that the targeted monetary aggregate (£M3) bad been so badly distorted by financial innovation that it could no Ionger serve as a reliable guide to interest rate policy formulation (Bank of England, 1986)....
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| Published in | Finanzmärkte, Finanzinnovationen und Geldpolitik p. 73 |
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| Main Authors | , |
| Format | Book Chapter |
| Language | German |
| Published |
Duncker & Humblot
19.11.2021
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| Edition | 1 |
| Online Access | Get full text |
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| Summary: | The UK monetary authorities abandoned broad money targeting in the mid 1980s because they feit that the targeted monetary aggregate (£M3) bad been so badly distorted by financial innovation that it could no Ionger serve as a reliable guide to interest rate policy formulation (Bank of England, 1986). Subsequently interest rate changes were guided by narrow money (MO) growth and exchange rate movements, first in the mid 1980s as a result of ‘shadowing the Deutschemark’ and then inside the ERM between October 1990 and September 1992. Since sterling’s exit from the ERM intermediate (monetary) targeting has been eschewed in favour |
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| ISBN: | 9783428084906 342808490X |
| DOI: | 10.2307/j.ctv28hj4cz.6 |