As expected, the effects of lower oil prices are at this stage more apparent in lower inflation performance and nominal interest rates than in faster growth of activity. It now seems that the industrial economies were growing less rapidly at the turn of the year than had previously been thought, and that oil producers are cutting back their expenditures more rapidly than consumers spend their gains. For the United Kingdom this general experience combines with a continuing rapid growth of nominal earnings and liquidity to present an awkward background for monetary policy. This Assessment discusses these issues together with those raised for financial supervision, both domestically and internationally, by institutional changes and new financial instruments.
Published on
01 June 1986
General assessment