July 9 (Bloomberg) -- Central banks should use more “expert discretion” in setting interest rates as inflation targeting alone won’t stop asset bubbles, Czech policy maker Eva Zamrazilova said in a commentary printed by Hospodarske Noviny.
Consumer inflation indexes used by most central banks as a basis for their policy decisions do not account for asset prices, Zamrazilova wrote in the Prague-based newspaper today.
“On the back of today’s extremely low interest levels, a germ of a new problem is probably being born somewhere,” Zamrazilova wrote in the opinion piece.
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