The macroprudential policies of central banks during the COVID-19 pandemic: A comparative analysis of the US and the UK

Abstract

The Covid-19 pandemic first gained its remarkable and destructive momentum in early 2020, proving to be the greatest single challenge for national and international community economic policymakers since Great Depression in the 1930s. This dissertation comprises five chapters, focusing on comparative analyses of macroprudential policies of the US Federal Reserve Bank („Fed‟) and the Bank of England (BoE). Chapter 2 examines the history of the BoE and Fed and their institutional evolution, providing a synthesis of their roles within national economic policy development and implementation. In Chapter 3, the focus of the comparative analysis shifts to consider the specific macroprudential policy initiatives that the BoE and Fed have used to deal with the unique economic and financial institution regulatory challenges that the Covid-19 pandemic poses both now and in the future. In summary, this dissertation suggests that the BoE and Fed leadership gained valuable insight from their management of the 2008 global financial crisis and its aftermath, which have since been applied with reasonable success to date, in response to the Covid-19 pandemic. This supports the preliminary conclusion of this dissertation, which suggests that both the Fed and BoE have been largely successful in terms of how they have devised and implemented their respective Covid-` response policies. It is likely that both institutions are well positioned to continue these policies until the Covid-19 crisis has passed, and thus build on their improved institutional ability to .manage other, inevitable future financial crises