FROM THE BLOG
A review on the distributional effects of monetary policy
Inequality has long been a foremost public concern, but not so for central banks. While the orthodoxy according to which central banks engage in “neutral” policy-making is slowly crippling away, we’re still enormously far from taking the distributional consequences of money creation and allocation seriously. Intensifying the debate on the inequality effects of the central bank’s monetary policy is a small step in that direction. This blog suggests several starting points for that.
A people’s monetary dialogue: what our supporters want from the ECB
True to our commitment to being the bridge between people and the European Central Bank (ECB), ahead of the last monetary dialogue in June we collaborated with our friends at SumOfUs to collect our supporters’ views, expectations and concerns related to the ECB’s work. The results showed overwhelming support for ambitious and proactive environmental actions by the ECB. They also rang a bell about the need for clearer communication from the Central Bank on the effects of its interest rate hikes.
The European Central Bank hikes interest rates after over a decade. Is this the right move for people?
On July 21st, the European Central Bank (ECB) announced that it is raising interest rates by 0.5 per cent, opting for an even higher hike than what was announced in June. Over the past few months, Positive Money Europe has repeatedly warned that higher interest rates are simply not the right solution to current price increases, as they will negatively affect people and jeopardise the well-being of our economies and the future of the post-pandemic green recovery. Why do we think so? In this blog, we answer a few questions about the impact that rising interest rates will have on people’s daily lives.
Counting on the ECB to act on fragmentation risks
The risk of fragmentation has accompanied the Eurozone since its origin. With the ECB ending its expansionary monetary policy, it has reoccurred once again. The ECB vowed to put the issue of fragmentation at rest with a new tool announced in July 2022. But its success depends on the ECB’s decision-makers realising their power and using it accordingly.
To avoid another subprime crisis, banks must help consumers to renovate their homes
The latest ECB climate stress test shows that banks could face a wave of insolvencies on their mortgage lending as energy-inefficient homes make their clients vulnerable to higher energy prices. Banks’ unpreparedness to collect data on the energy efficiency of their real estate exposures exacerbates this risk even more. This is a wake-up call for the EU and governments to urgently strengthen supervision and oblige banks to unlock finance for the renovation wave.
The ECB finally adopts green rules for its monetary policy
The European Central Bank (ECB) finally announced a clear shift away from its sacrosanct “market neutrality” principle, as it will introduce green criteria in its rules for corporate bond purchases and refinancing operations. While this is a significant improvement, the introduction of these measures remains slow and applies to only 5.87% of the ECB’s balance sheet.
Join the campaign
As a supporter, you’re at the heart of everything we do. We’d love to keep you updated about our exciting work and the ways you can help, including campaigns and events that you might be interested in. We promise never to sell or swap your details and you can change your preferences at any time. To do so, simply call +32 2 880 04 34 or email info@positivemoney.eu
Read our privacy policy here.