Cutting rates no boost: Perng

NO QUICK FIX:Monetary policy alone is not enough to increase growth, the central bank governor said, adding that fiscal policy and structural reform should be adopted

Taipei Times
Date: Mar 11, 2016
By: Staff writer, with agencies

Central bank Governor Perng Fai-nan (彭淮南) yesterday said that with interest rates already low, a further lowering of rates would provide no obvious boost to the economy.

However, cutting interest rates could help stop the inflow of hot money, Perng said at a meeting of the Finance Committee at the legislature in Taipei when asked by lawmakers for his views on lowering interest rates.

Perng said the purpose of reducing interest rates is to stimulate investment.
Such measures have a bigger effect when interest rates are high, but have only a limited effect when interest rates are already low, he said.     [FULL  STORY]

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