Monetary Policy
We are saddened to hear of the death of Sir Samuel Brittan, a long-standing friend of the Institute of Economic Affairs who played a major part in one of its greatest successes. One of Britain’s most distinguished and influential economic journalists and commentators over many years, he was also an important public intellectual more generally. ... Continue reading

Julian Jessop quoted in The Telegraph

The Telegraph has revealed that secret "stress tests" by Treasury officials in recent weeks found that a hike in interest rates from 0.2 per cent to 1 per cent would increase the Government's borrowing costs by between £30billion and £40billion a year. Speaking to the newspaper, IEA Economics Fellow Julian Jessop said that, while there ... Continue reading
The real 'news' is not that we're in a recession, but that the recovery accelerated in June as lockdown began to be lifted, says IEA Economics Fellow Julian Jessop. While he conceded that "there is still a long way to go before these green shoots return the economy to where it was before the pandemic ... Continue reading
Monetary Policy
Imagine that the government could simply print whatever money it needs to guarantee everyone a decent income, fantastic public services, and a secure job if they wanted one – with enough left over to save the planet too. That, for many, is the promise of a new economic paradigm known as Modern Monetary Theory (MMT). ... Continue reading
In its meeting of 14th July 2020, held by video-conference due to ongoing COVID-19 restrictions, the Shadow Monetary Policy Committee (SMPC) elected, by a vote of nine to zero, to hold rates in August. Five members favoured holding Quantitative Easing (QE) at its current level. Two favoured reducing QE. Three expressed a bias to raise ... Continue reading
Monetary Policy

IEA research quoted in The Daily Telegraph

The Government’s debts are now worth more than the entire economy’s annual output, Tim Wallace reports in The Daily Telegraph. The debt’s sustainability also relies on interest rates remaining low. Currently the general view is that deflation is a bigger risk than inflation, with central banks around the world struggling to lift inflation to their ... Continue reading

IEA research quoted in The Times

Money printing could "send prices soaring," writes The Times' Economics Editor Philip Aldrick. Citing the IEA's new briefing paper – Inflation: The next threat? – which was authored by two members of the Institute of International Monetary Research, Aldrick says: "With the consumer prices index in Britain falling to a four-year low of 0.5 per cent, uncontrolled ... Continue reading

IEA research quoted in the Daily Mail

One fear among some economists about the policy response to the virus is that we are storing up huge trouble and at some point down the line it will create an inflationary boom. Quoting our new briefing paper, "Inflation: The next threat?", the article says: "The IEA raised the spectre of rampant inflation yesterday, warning ... Continue reading
New research from the Institute of Economic Affairs asks: Is inflation the next threat? The policy reaction to the Covid-19 pandemic will increase budget deficits massively in all the world’s leading countries; The deficits will to a significant extent be monetised, with heavy state borrowing from both national central banks and commercial banks; By mid- or ... Continue reading
Research
Summary The policy reaction to the Covid-19 pandemic will increase budget deficits massively in all the world’s leading countries. The deficits will to a significant extent be monetised, with heavy state borrowing from both national central banks and commercial banks. The monetisation of budget deficits, combined with official support for emergency bank lending to cash-strained ... Continue reading