The Counterparts Approach to Analysing Broad Money
The counterparts analysis of developments in broad money has been a key feature of the interpretation of UK financial developments since the 1960s. It received renewed emphasis in the 1980s as the way in which the various aspects of fiscal, funding, exchange rate and monetary policy were integrated. In this chapter we explain how this approach to the analysis of broad money is developed. The problems faced by the U.K. authorities in implementing this approach in practice are left to Chapter 6.1
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