Wednesday, April 16, 2008

Are We On Right Track?

DELHII DAYAR TUV BANK HUUGEE BUULGAJ BAIHAD MONGOL BANK INGEJ TENEGTEHEE BOLIMOOR YUM.EDIIN ZASAG ARAI CHADAN URAGSHLAH GEJ BAINA, IIM UED DEMJIJI TUSLAAD OGOOCH, HYAMD ZEEL HEREGTEI BAINA SHU DE.
Монголбанк мєнгєний бодлогын хvvгээ чангарууллаа

The Bank of Mongolia further tightened its monetary policy stance by raising its policy rate by 1.35 percentage points to 9.75 percent. The Bank of Mongolia defines 7-day Central Bank Bill rate as its policy rate which tends to be effective in influencing interbank money market. [...] An increase in the policy rate of 1.35 percentage points is deemed to be necessary to bring CPI inflation down, to reduce the growth of credit and monetary aggregates.
Bank of Mongolia again raises its policy rate

In order to prop up the króna, and keep foreign capital from fleeing, Iceland’s central bank has had to raise interest rates to an astounding fifteen per cent, a move that will slow the economy to a crawl. [...] If Iceland were to attempt to emulate America’s approach, its currency would be demolished, and foreign investors would almost certainly head for the exits. [...] [The U.S.] doing this not out of kindness, of course, but because the U.S. is a colossal market and they need us to keep buying stuff. The world can’t afford to have the U.S. fail, and so we are able to get away with behavior that would wreck smaller countries.
Iceland’s Deep Freeze

5 comments:

Ачболд said...

According to Ben Bernanke, the current consensus among modern monetary theorists is that in order to have low unemployment, you want to have low inflation and stable prices (contrary to what the Phillips curve says). http://www.youtube.com/watch?v=Pzi7DhKbHOU

Herev uneheer tiim bol Mongol bank interest rate-ee nemj inflyats-aa togtooh heregtei l dee.

By the way, I'd really recommend the lecture by Bernanke at Princeton posted above.

Ачболд said...

Or I guess I should say, contrary to what the Phillips curve used to imply.

Indra said...

http://www.business-mongolia.com/mongolia-news/mr-abatsukh-mongolbank-governor-it-is-clueless-that-tugrug-rate-is-to-fall-down/

Tuvshin said...

Yep you're right Achka, Phillips Curve should occur only when there is an unanticipated inflation and cyclical unemployment (if I'm not mistaken, Friedman and Phelps have proved this in the 60's, and Phelps was awarded Nobel Prize for this contribution two years ago).

In another words, there is no justification whatsoever for Mongol Bank to let loose the inflation. So, I'm completely pro-tight monetary policy (although it can cause recession, it's gonna be shorter and less severe).

SaRaNTeNGeR said...

Тэр дээр мөнгөний хүүгийн бодлогоо нэмсэн нь хэд хэдэн төрлийн шалтгаантай. Хүмүүс болохоор мөнгөний ханш унах нь гээд банкнаас мөнгөө татаж аваад, нөгөө талаар зарим нэг банкууд мөнгө хураах бодлого барьж байна гэх.

Нөгөө талаар арилжааны банкууд том зээл өгөхөө больчихсон. Энэ нь мөнгөний хүүний бодлоготой ч бус. Сонгууль болохгээд сонгуулийн санхүүжилтэд банкнаас зээлсэн мөнгөнүүд ороод эхэлчихсэн юм билээ. Тийм ч учраас энэ 2 сарын сүүлээс банкууд том зээл өгөхөө болиод зээлийн хүүгээ зориудаар нэмчихсэн байгаа. Сонгууль өнгөрсөний дараа угаасаа хүүний уян хатан бодлогоо үргэлжлүүлнэ. Төв банк ч хүүгээ бууруулна итгэлтэй байна.