Costas Milas

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    To get its forecasts right, the BoE should publish its own future rate path again

To get its forecasts right, the BoE should publish its own future rate path again

It was widely expected and indeed happened. The Bank of England’s Monetary Policy Committee (MPC) decided, by a 7-2 majority, to raise (for the first time in 10 years) its policy rate from 0.25% to 0.5%. Yet, financial markets appear not to have taken seriously either the hike or the MPC’s additional message that (at least) two further interest […]

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    Brexiteers’ hope for an export-led economy risks proving naïve

Brexiteers’ hope for an export-led economy risks proving naïve

Theresa May has sent the Article 50 notification to the EU, setting out seven principles (presumably in a hierarchical order of importance), with the second being the protection of the working rights of EU citizens here and UK citizens in Europe. This confirms what Michel Barnier (the EU negotiator) considered as a major priority. This should be good news: both sides agree on the […]

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    How credit rating agencies calculated their ratings during the Eurozone crisis

How credit rating agencies calculated their ratings during the Eurozone crisis

Sovereign credit rating decisions taken by major agencies such as Moody’s, Standard & Poor’s (S&P) and Fitch are often considered a ‘black box.’ Empirical analysis has concluded that up to 40 per cent of credit rating decisions cannot be explained by economic fundamentals.

This is not a trivial issue because sovereign credit ratings provide a measure of the probability that […]

Let Mark Carney do his job

Serpentines, by Unsplash, under a CC0 licence
A series of Halloween monetary policy stories emerged over the weekend. Both The Sunday Times and The Financial Times reported that Governor of the Bank of England Mark Carney, is under pressure to leave his job. This speculative but certainly destructive noise about Carney’s possible departure gained momentum after Theresa May warned of […]

Brexit is already affecting the British economy

Following the recent Brexit vote, it appears that neither David Cameron nor Tory contenders for the top job like Theresa May are willing to trigger the notorious Article 50 ‘before the end of the year‘. This is ironic because we were repeatedly told by Brexiters that we need to ‘take back control’ of our country as soon as possible. […]

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    Expect some re-shuffling in markets today – irrespective of the referendum result

Expect some re-shuffling in markets today – irrespective of the referendum result

There have been a number of warnings that a vote to leave the European Union on 23 June may have adverse effects on the UK stock market, both from public institutions – such as the Treasury and the IMF – and private companies in the financial sector. These predictions suggest that Brexit would reduce the expected profitability of listed […]