Eichengreen on CB priorities

“Rather, [central banks] are agencies for pursuing the public good. Their first responsibility is hitting their inflation target. Their second responsibility is to help close the output gap. Their third responsibility is to ensure financial stability. Balance-sheet considerations rank, at best, a distant fourth on the list of worthy monetary-policy goals.”

Yeah, Dr. Eichengreen, tell that to a central bank in a country with a convertible currency in a target exchange-rate band 🙂


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