counter-cyclical

Central banks find that a tool to curb bubbles is doing the job

SINGAPORE (Dec 4): Central bankers are starting to see promising results from one of the recent additions to their monetary policy toolbox.

Lending curbs to stem financial risk -- so-called macroprudential limits -- have helped slow risky borrowing and temper property price bubbles in countries from New Zealand to Canada, a host of financial stability reports showed this week. While there hasn’t been uniform success -- Hong Kong’s housing market shows no signs of cooling -- it’s given central banks some breathing space to be more gradual in tightening monetary policy.

Be informed of the stories that matter

Subscribe

Be informed of the stories that matter