Central bankers carry the aura of cardinals since they manage money mysteriously through creation of central bank reserves. The Bank of Japan (BoJ) is champion central bank at 132% of GDP, with People’s Bank of China at 33.9% and European Central Bank (ECB), 60.6%. These four central banks alone accounted for US$30.1 trillion (RM126.12 trillion) in asset size or 35.5% of world GDP (yardeni.com). Here’s why we cannot disentangle monetary policy from climate change, low productivity and social inequality. Central banks in the smaller markets already recognise the threat and South Korea is the first to signal the increase in interest rates.
