The annual report of the Bank of Italy for 1953

Abstract

The first part of the article summarises some of the views concerning current Italian problems expressed by the Governor of the Bank of Italy, Dr. Menichella, in his Annual Address to Shareholders. The author gives particular attention to Menichella’s views on the technique of credit control by the Bank of Italy, commenting on the stress which the Governor placed on rigid and fortuitous elements that have influenced the total volume of accommodation granted by the Bank of Italy in recent years, his conclusion that the instruments of control available to the Central Bank are imperfect and his observations on the smallness of the area of manoeuvrability in fiscal policy. The author raises the question whether in the case that the combination of rigid and fortuitous factors should be less favourable in the future than it has been in the past, the monetary authorities might not still be able to tighten their control through a flexible interest rate policy of the kind that has been adopted in many other countries since 1951. The second part of the article gives a summary of the year’s developments, mostly in the financial sphere. It includes a brief description of the new cartel agreement between the commercial banks, and the system of interest rates which has been officially established thereunder. 

JEL: E43, E52, E58, E62