Following is some of the key soundbites from central banks that reviewed monetary policy settings over the past week:
- Hungary central bank (held interest rate at 6.00%): "Inflation is likely to be above target in the short term, due to cost-push pressures stemming from the rise in commodity prices. However, owing to the disciplining effect on price and wage-setting of the persistent weakness in domestic demand and high unemployment, the 3% inflation target can be achieved at the end of 2012 by maintaining interest rates at their current level over a sustained period."
- The US FOMC (held interest rate at 0-0.25%): "The Committee continues to anticipate that economic conditions--including low rates of resource utilization and a subdued outlook for inflation over the medium run--are likely to warrant exceptionally low levels for the federal funds rate for an extended period."
- Bank of Namibia (held interest rate at 6.00%): "It is the view of the EC [Executive Committee] that the observed growth momentum at the beginning of the year that created an impression that [the] recovery was consolidating, was not firmly entrenched,"... "The EC also observed that inflation has increased, but still remains in tolerable levels, especially the underlying inflation,"
- Norway (held interest rate at 2.25%): "Overall, the Executive Board is of the view that the key policy rate should gradually be raised through the latter half of 2011, against the background of the current outlook and balance of risks."
- Czech National Bank (held interest rate at 0.75%): "Headline and monetary-policy relevant inflation will be close to the inflation target over the monetary policy horizon. Consistent with the forecast is broad stability of market interest rates in the near future and a gradual rise in rates starting in 2011 Q4. Risks to the forecast are balanced for monetary-policy relevant inflation."
- Sierra Leone (held interest rate at 23.00%):
Next week is set to be a relatively quiet week on the monetary policy front. The Bank of Israel meets on the 27th of June (expected to increase 25bps to 3.25%), The National Bank of Romania meets on the 29th of June (expected to hold at 6.25%), and the Central Bank of the Republic of China (Taiwan) meets on the 30th of June (expected to increase 12.5bps to 1.875%).
Article source: http://www.centralbanknews.info/2011/06/monetary-policy-week-in-review-25-june.html