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C

SA

Can the interest rate help predict economic activity?

by Shahir Muhammad Amin - Thursday, 9 February 2023, 12:42 AM
 
In this paper we discuss whether or not historical data indicates that the interest-rate is useful for predicting future economic activity. Consequently, we are seeking to understand, through in-sample and out-of-sample analysis, whether monetary policy has been effective. We use methodology from older, reputable papers such as Bernanke, B.S (1990), who also used bivariate analysis, and apply these methods to a more recent dataset. We took necessary steps to ensure our results were robust, and we drew our conclusions carefully. Our results from the VAR models were in-line with expectations, the multi-variate model which included the interest rate consistently out-performed the bivariate model, and the multi-variate granger causality analysis produced some interesting, understandable findings. Once we concluded that there is information content in the interest-rate, we then move on to discuss monetary policy recommendations for the UK with the backing of our findings and the literature. 
 
 

G

DF

Group CA - Japan's Ageing Population

by Daniel Adebola Ayodeji Fajuke - Wednesday, 8 February 2023, 12:02 AM
 

2022 saw low levels of inflation in Japan despite many other developed countries seeing stark increases in their domestic inflation. This has been pinned down to many reasons; the pace of reopening in Japan after Covid-19 (and Asia more generally), Government efforts to control price levels and the differences in CPI composition. However, one of the demographic factors that continue to stand out in Japan is its ageing and shrinking population. This presentation/report looks to provide a deeper understanding of the issue, the economic impacts and potential policy recommendations to consider.


 

TN

Group EA - The Bank of England's Reserve System Structure

by Tendai Kimberly Stephanie Nyamushonongora - Wednesday, 8 February 2023, 1:22 PM
 

Britain is in the midst of a cost of living crisis with high levels of government borrowing and increasing interest rates to combat high inflation. Under the floor system, the Bank of England currently renumerates all commercial bank reserves held with them at bank rate, the official short term interest rate set by the Monetary Policy Committee. This has meant that commercial banks have been benefitting from higher interest rates as they receive more interest on their reserves . 

Is it time for the interest payments on commercial bank reserves to be taken as government tax revenue to help fill fiscal gaps? This presentation and report looks at different policy options for restructuring the reserve system.

 

R

TN

Reserves presentation

by Tendai Kimberly Stephanie Nyamushonongora - Monday, 17 April 2023, 10:44 AM
 

Reserves presentation