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Interest rates and deflation

By Frances Coppola Scott Sumner argues that when the monetary base is fixed, low interest rates are deflationary. I've emphasised the fixed monetary base because it is an important condition. If the monetary base is NOT fixed then the…

Indonesia: Falling Behind the Curve

Bank Indonesia has fallen far behind the curve in its currency management tactics. After fairly steady intervention kept USD/IDR trading near the 10,000 area from May through early August, the authorities have been allowing the pair to move…

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