The BOE said the annual rate of inflation will remain above its target for longer than expected, but it won't tighten monetary policy and risk derailing a recovery.
He warned that a "premature tightening of monetary policy" would risk "slowing or ending the economic recovery".
What we need is an independent Fed that deals with two subjects: systemic risk and monetary policy.
Given such a risk, monetary policy in the rich world, taken as a whole, looks dangerously tight.
Without attention to the dynamic effects of their actions, central bankers risk leaving monetary policy too loose or too tight for too long.
Some say that at this time with a risk of monetary adjustment via higher central bank rates the hope premium may be unduly high.
The ECB president said that if high sovereign yields hurt the transmission channels for monetary policy, keeping risk premiums under control would come within the bank's mandate.
Federal Reserve Chairman Ben Bernanke and his fellow members of the Federal Open Market Committee indicated that a pause in the economic recovery has given way to moderate economic growth once again, and offered no signal that its current monetary policy is at risk of drastic alterations.
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It was (and is), for example, a chronic failure of international bank regulation that the debt of Italy, Spain, Germany and so on was classified by financial regulators as completely safe and without risk after monetary union - which gave an unhealthy incentive to banks to lend to these governments (in the jargon, the government bonds of these countries were given a zero risk-weighting).
The longer the Fed pursues monetary expansion, the greater the risk associated with the accumulation of these bonds.
Thanks to easily available credit, these may have replaced consumer-price surges as the main risk of excessively loose monetary supply.
The risk is that the monetary boost will be as temporary as the gains from 20 years of Keynesian deficit spending have proven to be.
The lesson from Japan is that, if there is the slightest risk of deflation, monetary policy needs to be looser than warranted by current economic conditions.
Over the past decade investors, firms and consumers put far too much faith in the power of information technology, globalisation, financial liberalisation and monetary policy to reduce volatility and risk.
A. Hayek long ago pointed out the dangers of monetary manipulation to underprice credit and encourage risk taking.
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Perhaps, on the other hand, they are simply the beneficiaries of ultra-loose monetary policy and a huge appetite for risk among investors.
The Fed faces a very dangerous tradeoff: risk higher inflation by expanding the monetary base (currency plus bank reserves) in a vain attempt to lower unemployment.
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On the other risk, a real tightening of monetary policy, Winmill explained that the end of QE2 acted like a tightening of 300 basis points along the middle of the curve.
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Moreover, while there is some economic slack, borrowing by firms remains weak and monetary policy is loose, there is scant risk that rising interest rates will crowd out the private sector.
Mewbourne calls this "outsourcing your monetary policy, " and it does involve some risk.
Gold is the stronger of the two since it serves as a haven for those who are also wary of the risk of owning dollars, given government monetary and fiscal policies.
Part of an easy money, low interest rate monetary policy is to get corporate investors to take on risk and invest their money in production.
Raising interest rates to defend currencies at the risk of stalling fragile economic recoveries aided by aggressive monetary easing is politically difficult.
Andrzej Slawinski, a member of the Polish central bank's monetary-policy council, believes there is less of a risk that the new member states will follow in the footsteps of Greece, Ireland, Portugal and Spain.
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China leads the way in terms of reserve accumulation, but Brazil, Russia, Japan, and various other East Asian nations have been amassing huge fortunes which are now at risk due to U.S. economic and monetary policy.
While commodity prices are being fueled in part by excess liquidity chasing risk, as developed economies follow through with loose monetary policy, the dynamics behind emerging market currency fluctuations, especially the real, are traced out by their interaction with China.
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Although Greece has yet to reach an agreement with its private creditors, and the International Monetary Fund cut its global growth forecast Tuesday, "risk sentiment has received some support from better economic data out of Europe, " said Barclays Capital strategists in a report.
Mr Delors himself, in a seminal report of 1989 launching the process of monetary union, warned about the dangers of economic imbalances and the risk that states could be shut out of bond markets.
The risk of recession is rising globally, according to the latest International Monetary Fund forecast.
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In a study last year, the International Monetary Fund concluded that ratings were a reasonably good indicator of sovereign-default risk.
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