FXStreet (Guatemala) - Analysts at Brown Brothers Harriman noted that Draghi appeared to be singing from the same song book as Yellen regarding the use of monetary policy to address financial stability.
“Like the Fed Chair yesterday, Draghi indicated that macro-prudential measures and regulation is the first line of defense, not monetary policy (price and quantity of money)”.
“Monetary policy seems to blunt of an instrument and operates with unpredictable lags. Macro-prudential policy and regulatory efforts are more precise and can be implemented almost immediately. This is part of the new orthodoxy”.