- Home
- Publications
- Commentary: Interest Rate Normalisation
Commentary: Interest rate normalisation
Downloads
Commentary: Interest Rate NormalisationAuthors
Related Themes
Macro-Economic Dynamics and PolicyJournal
National Institute Economic Review
Publisher
Sage Publications, London
External Resources
http://journals.sagepub.com/doi/full/10.1177/002795011724100103
Issue
241
On 5 March 2009 the Monetary Policy Committee of the Bank of England cut Bank Rate to 0.5 per cent from 1.0 per cent. This was an historic low in the policy rate and reflected both the extent of the financial crisis and its prospective impact on the real economy. It was 89 MPC meetings later that Bank Rate moved again on 4 August 2016 but to an even lower level of 0.25 per cent. In this Commentary I shall outline why it has proved so difficult to get away from the low interest rate trap but also suggest that it is time to start thinking about reversing and returning to ‘normal’ times.
I am grateful for research assistance by Rhys Williams and for comments and conversation with Bill Allen, Richard Barwell, Roger Farmer, Amit Kara, Kiyohiko Nishimura, Peter Sinclair and James Warren. This commentary draws on a talk given to the Daiwa Anglo-Japanese Foundation on 13 July 2017 at the Embassy of Japan. j.chadha [at] niesr.ac.uk , NIESR and Centre for Macroeconomics
Related Blog Posts
Public Debt Sustainability and Fiscal Rules
Stephen Millard
Benjamin Caswell
05 Feb 2024
4 min read
Related Projects
Related News
Call for Papers: Lessons From Quantitative Easing & Quantitative Tightening
09 Feb 2024
1 min read
Related Publications
Adam Smith and the Bankers: Retrospect and Prospect
04 Jan 2024
National Institute Economic Review
On the Promises and Perils of Smithian Growth: From the Pin Factory to AI
04 Jan 2024
National Institute Economic Review
Economic Progress and Adam Smith’s Dilemma
04 Jan 2024
National Institute Economic Review
Adam Smith’s ‘Wealth of Nations’ is Still Relevant to UK Trade Policymaking on International Trade
04 Jan 2024
National Institute Economic Review