Vital signs. When cutting interest rates might not help
- Written by Richard Holden, Professor of Economics and PLuS Alliance Fellow, UNSW
Whether there is a floor beneath which cuts in interest rate are ineffective depends in part on house prices.ShutterstockThere’s a meme around official interest rates since the financial crisis, and it goes like this. Central banks have already cut them to nearly zero (or actually zero) but advanced economies are still languishing. Therefore...
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