BOE’s Carney Tells Bankers to Clean Up Their Acts | Real Time Economics – WSJ

By Jason Douglas

Bank of England Gov. Mark Carney said Tuesday the misdeeds of the financial sector risk undermining public support for free markets and called on bankers to radically improve their behavior, a sign of simmering frustration in policy circles over a string of misdemeanors.

In a forthright speech, Mr. Carney said recent scandals in currency and commodity markets highlight “a malaise in corners of finance that must be remedied,” saying such “corruption” has hurt trust in modern capitalism, according to the text of his speech.

His remarks echoed criticism of the financial sector earlier Tuesday by International Monetary Fund Managing Director Christine Lagarde, who accused banks of delaying much-needed reforms to the financial system, which were agreed to in the wake of the crisis that tipped the world into recession in 2009…..

Read more at Bank of England’s Carney Tells Bankers to Clean Up Their Acts – Real Time Economics – WSJ.

Surprise as BOE, ECB Give Forward Guidance | WSJ

New [BOE] governor Mark Carney has already made changes. In a statement accompanying the widely-expected decision to leave both rates and asset purchases unchanged, the BoE said that rising market rates had shifted expectations for the Bank Rate above levels that were justified by the economic situation.

The fact that there was a statement at all indicated a change in policy. The old BOE just announced its decision and left interpretation to the markets.

This was a clear attempt to talk the markets down and it worked.

Read more at Recap: Surprise as BOE, ECB Give Forward Guidance – MoneyBeat – WSJ.

Carney broaches dumping inflation target |

Claire Jones reports that Mark Carney says central banks should consider scrapping inflation targets and target nominal GDP instead — allowing more aggressive measures during a down-turn.

[Mark Carney, next governor of the Bank of England] suggested that a nominal GDP target, where a central bank sets monetary policy based on both inflation and growth, would do more to boost economic output. “For example, adopting a nominal GDP-level target could in many respects be more powerful than employing thresholds under flexible inflation targeting,” he said.

Read more at Carney broaches dumping inflation target –