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Monday, January 29, 2018

Central Banking on Autopilot: Monetary Policy Suffers a Shortage of Central Bankers

In their quest to stabilise the job market, central banks are setting a bad example. Jerome Powell, whom senators this week confirmed as the next chairman of America’s Federal Reserve, will lead an institution with three existing vacancies on its seven-member board, and a fourth that will open up imminently. 

Not since July 2013 has its rate-setting committee boasted the full complement of 12 voting members. 

This monetary undermanning is, however, much worse in Nigeria. Its monetary-policy committee was unable to meet as scheduled on January 22nd-23rd because it lacked the six members necessary for a quorum. Five recent nominees still await confirmation by the country’s Senate. The chamber is holding up all but a few executive appointments in retaliation for President Muhammadu Buhari’s failure to remove an official (the acting anti-corruption tsar) whom the Senate twice rejected. 

In the absence of a monetary-policy meeting (and the lengthy communiqué that eventually follows it), the central bank posted a brief, scanned note on its website, explaining that it would not tinker with its existing policy stance. 

Read the story here - https://lnkd.in/dtRh99H

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