The combination of loose monetary policy and high public spending should to be maintained to lift the economy towards recovery, according to ECB chief economist Philip Lane. The former Central Bank of Ireland governor said that ensuring monetary and fiscal policy are both supportive needs to be the main focus for policy makers for the ‘next while’ rather than action to cut debt. Read MoreAround a third of Irish government debt is held by the Central Bank. The past decade’s combination of lose monetary policy and tight fiscal policy should be flipped in favor of looser government spending but tighter interest rate policy, he said. The past year has seen central bank monetary policy including negative interest rates and huge bond buying run alongside expansionist fiscal policy to offset the economic impact of the pandemic.

Source: Irish Independent February 10, 2021 02:07 UTC