IMF Working Papers

Central Bank Independence and the Conduct of Monetary Policy in the United Kingdom

By Hossein Samiei, Jan Kees Martijn

December 1, 1999

Download PDF

Preview Citation

Format: Chicago

Hossein Samiei, and Jan Kees Martijn. Central Bank Independence and the Conduct of Monetary Policy in the United Kingdom, (USA: International Monetary Fund, 1999) accessed November 21, 2024
Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The U.K. monetary policy framework, which combines inflation targeting with operational independence, provides a suitable arrangement for focused and credible monetary policy. However, potential weaknesses could result from features that have not yet been fully tested: the credibility and transparency of the inflation forecasts, which form the core of policy decisions, have diminished as a result of independence; and the framework could encourage excessive activism and frequent changes in interest rates. Although policy coordination could also suffer from independence, the new partly rules-based fiscal and monetary regimes will promote overall macroeconomic stability.

Subject: Banking, Central bank autonomy, Central banks, Fiscal policy, Inflation, Inflation targeting, Monetary policy, Monetary policy frameworks, Prices

Keywords: Central bank, Central bank autonomy, Central bank independence, Gradualist monetary policy, Inflation, Inflation target, Inflation targeting, Instrument independence, Interest rate, Interest rate decrease, Interest rate expectation, Interest rate projection, Interest rate trend, Monetary policy, Monetary policy decision, Monetary policy decision making, Monetary policy frameworks, MPC behavior, Policy coordination, Stabilizing monetary policy response, U.K. government, United Kingdom, WP

Publication Details

  • Pages:

    22

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 1999/170

  • Stock No:

    WPIEA1701999

  • ISBN:

    9781451858402

  • ISSN:

    1018-5941

You May Also Be Interested In...

Kiribati: Agricultural Subsidies for Copra: Improving Efficiency and Equity and Balancing Trade-offs

November 21, 2024

Quarterly Projection Model for the Bank of Ghana: Extensions and Applications

November 15, 2024

Foreign Exchange Intervention Under the Integrated Policy Framework: The Case of India

November 15, 2024

Central Bank Digital Currency: Progress And Further Considerations

November 8, 2024