Archive for January 30th, 2023

Does money growth help explain the recent inflation surge?

January 30, 2023

Claudio Borio, Boris Hofmann and Egon Zakrajšek in this BIS Bulletin article:

  • The strength of the link between money growth and inflation depends on the inflation regime: it is one-to-one when inflation is high and virtually non-existent when it is low.
  • A link can also be seen in the recent possible transition from a low- to a high-inflation regime. An upsurge in money growth preceded the inflation flare-up, and countries with stronger money growth saw markedly higher inflation.
  • Looking at money growth would have helped to improve post-pandemic inflation forecasts, suggesting that its information value may have been neglected.

Will monetary aggregates make a comeback?

Past Economic Surveys put it best: Private investment is India’s best growth mantra

January 30, 2023

My new piece in moneycontrol summing one key lesson from previous economic surveys.

%d bloggers like this: