Unmarked crossroads

23 May 2013 By Edward Hadas Follow @edwardhadas

After years of slow growth and ineffective policy responses, experts are stumped and investors are jittery. Bernanke’s two-sided talk and the Japanese market’s exaggerated response were all too typical. Barring recovery, crisis or revolution, there will be much more of the same.

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The International Monetary Fund on May 22 published its annual review of the British economy, the Article IV Consultation Concluding Statement. It said that “a slow recovery remains likely” and recommended an “accommodative stance” in monetary policy and “preserving the fiscal framework” while speeding up “growth initiatives”.
Also on May 22, U.S. Federal Reserve Chairman Ben Bernanke testified before the Joint Economic Committee of the U.S. Congress. He said that a decision to scale back the $85 billion in bonds the Fed is buying each month could come at one of the central bank’s “next few meetings”, but that the central bank needs to see further signs of traction.
Japan’s main Nikkei share index fell 7.3 percent on May 23.

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