To lift off from the ZLB in the second half of 2022, I believed tapering of asset purchases would have to start in the second half of 2021 and conclude by the third quarter of 2022. This projection was based on my judgment that the economy would heal much faster than many expected.
Assessing the Irish economy in 2007 the IMF – which I quote for convenience, not to blame it – wrote: “Fiscal policy has been prudent, with a medium-term fiscal objective of close to balance or surplus, in line with Fund advice. In the past couple [of] years, windfall property-related revenues were saved and the fiscal stance was not procyclical, in line with Fund advice”.