Engendering Monetary Policy

Inflation-targeting monetary policy based on the New Keynesian Economic framework has been an obstacle to fiscal stimulus, employment, and growth, reducing public investment in equality supporting services and transfers, with disproportionate impacts for women. Empirical research highlights the gender-based distributional impacts of interest rate interventions via differential changes in employment, wages, and debt servicing burdens. Quantitative easing has increased wealth inequality by driving up the prices of assets which women are less likely to hold, while quantitative tightening raises challenges for the fiscal space needed to support a feminist agenda. Engendering monetary policy requires: reforms to central bank governance and consultative bodies; broadening mandates to target real variables; widening our understanding of the causes of inflation and the tools needed to address it; and an overhaul of operational procedures to introduce measures such as distributional impact assessments, facilities to incentivize investment in gender equality, and greater coordination with fiscal policy.