The Bank of Russia at the Crossroads: does the monetary policy needs easing
AbstractRecent slowdown of economic growth forces Russian political authorities to seek for policy measures to support economic activity. Monetary expansion is considered as one of the possible alternatives, which we consider inappropriate. During the whole post-crisis period monetary authorities of advances economies in their attempts to boost recovery relied heavily on different sorts of monetary stimulus. Thus it is sometimes argued that Russia should better use such kind of experience and shift to aggressive monetary expansion. This view is mostly wrong since it shows misunderstanding of the goals of the monetary easing policy implemented in advanced economies and also ignores the differences between Russia and advanced countries with respect to macroeconomic conditions. There are two main reasons for extraordinary monetary expansion in advanced economies: sizable cyclical recession and “zero lower bound” problem. Since none of these is present in Russia there’s no reason for implementation of monetary easing policy.
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Bibliographic InfoPaper provided by Gaidar Institute for Economic Policy in its series Working Papers with number 0067.
Length: 21 pages
Date of creation: 2013
Date of revision: 2013
monetary policy; Bank of Russia;
Other versions of this item:
- Eugene Goryunov & Pavel Trunin, 2013. "The Bank of Russia at the Crossroads: Does the Monetary Policy Needs Easing," Working Papers, Gaidar Institute for Economic Policy 0069, Gaidar Institute for Economic Policy, revised 2013.
- E41 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Demand for Money
- E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
- E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
- E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-05-24 (All new papers)
- NEP-CIS-2013-05-24 (Confederation of Independent States)
- NEP-MAC-2013-05-24 (Macroeconomics)
- NEP-MON-2013-05-24 (Monetary Economics)
- NEP-TRA-2013-05-24 (Transition Economics)
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