It’s the first day of August, traditionally the month many Europeans go on holiday, and there was a definite end-of-term feeling to the European Central Bank’s monthly press conference.
The bank unsurprisingly decided to keep its interest rates on hold and Mario Draghi, president, described data that “tentatively confirm the expectation of a stabilisation in economic activity as low levels”. So they see improvement, but they’re not calling the recovery just yet.
What else did we learn?
Today I received a letter from the Federal Reserve Board refusing a request that I made under the Freedom of Information Act. I asked for:
“all (a) operations reviews; (b) financial examinations; (c) budget reviews and approvals; and (d) year-end evaluations; of the twelve regional banks conducted by the Federal Reserve Board.”
In essence, I asked for information that the FRB has compiled to control and monitor the performance of the twelve regional Fed banks since 2000. The grounds for refusal were this:
In December 2004, the FOMC voted to expedite the release of its minutes to three weeks after they announce their policy decisions (about three weeks sooner than they had been).
Recently released transcripts give us a window in to the committee’s thinking, and the decision was not made lightly. You can imagine that now – as legislators call for increased Fed transparency – the FOMC may be having similar debates about what information is it going to offer to share with the public.
Ben Bernanke was sworn in today for his second term as Fed chief after last week’s controversial Senate vote. He ended up being confirmed with 70 votes, well over the number needed, but still far fewer than even unpopular central bankers are used to receiving.
So, are we looking at a new Fed chair, one humbled by his actions in the lead up to the financial crisis?
It’s hard to say. But he is willing to make at least one concession. Mr Bernanke called for the Fed to become more transparent.
The Federal Reserve is already one of the most transparent and accountable central banks in the world, providing voluminous information and explanation concerning all of its activities. However, I believe that we should be prepared to do even more, to become even more transparent. It is essential that the public have the information it needs to understand and be assured of the integrity of all our operations, including all aspects of our balance sheet and our financial controls.
Of course, he doesn’t want to go overboard.