Over-Rated Virtues of High Productivity Growth
August 11, 2009
Productivity, output per employee hour, plays a a key economic role. The growth of real GDP stems either from gains in hours worked or faster productivity. Strengthening productivity provides a basis for faster economic growth, better wages, lower inflation, and lower interest rates. The belief in a fairly enduring advance in productivity was the critical […] More
Central Bank Watch
Bank of Korea Retained 2.0% Seven-Day Repo Rate As Expected
August 11, 2009
South Korean monetary officials left monetary policy settings where such have been since a 50-basis point rate cut last February 12th. A statement from Bank of Korea officials framed the decision process as whether to keep the status quo or begin reabsorbing stimulus, suggesting that 2.0% is the cyclical floor. That’s what analysts have been […] More
Central Bank Watch
Bank of Japan Left Policy Stance Unchanged As Expected
August 11, 2009
After meeting for five hours over two days, the Policy Board retained a 0.1% rate target on overnight money, announced no other policy actions, and released a statement that introduced nothing new in the BOJ’s economic assessment. CPI inflation will remain negative but is projected to become less deflationary during the second half of the […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Disappointing Chinese Data
August 11, 2009
The dollar rose against commodity-sensitive currencies (up 1.0% versus the kiwi, 0.7% against the Canadian dollar and +0.4% against the Australian dollar) but has lost 0.7% against the yen. The greenback has dipped 0.2% against the Swiss franc and 0.1% relative to the euro. Movements are consistent with less risk aversion. Asian stocks closed higher […] More
