Analysing Narrow Money

Paul Temperton

Chapter 3 in UK Monetary Policy, 1991, pp 37-53 from Palgrave Macmillan

Abstract: Abstract When monetary targets were first introduced in the UK they were formulated in terms of the growth of broad money. The Medium Term Financial Strategy (MTFS) at first continued to give broad money a central role, but by 1982 the presentation of the MTFS was modified to include a specific role for a narrow money target. Between 1982 and 1984 the same target ranges were applied to three monetary measures: narrow money (Ml); broad money (£M3); and a broad measure of liquidity (PSL2). Furthermore, the authorities came to stress more strongly the importance of the examination of a range of financial and economic variables when judging the stance of monetary policy. These included such variables as the exchange rate, asset prices and the behaviour of inflation itself.

Keywords: Interest Rate; Cash Holding; Monetary Aggregate; Monetary Base; Broad Money (search for similar items in EconPapers)
Date: 1991
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-11836-6_3

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DOI: 10.1007/978-1-349-11836-6_3

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