Our students take part in European Central Bank QA

Students on our School of Business Intermediate Macroeconomics 2 module led by Professor Panicos Demetriades, took part in a live Twitter Question and Answer session with The European Central Bank’s (ECB) Executive Board Member and Chief Economist Peter Praet on Thursday 8 February.

Professor Panicos Demetriades, former Cyprus Central Bank Governor, is teaching his students about monetary policy and response to shocks. A keen tweeter, he noticed the European Central Bank were holding a Twitter Question and Answer session, encouraging people to #AskECB any questions they had. This tied in perfectly with his students' required learning and as chance would have it, matched the time of one of his lectures with them.

Professor Demetriades alerted his students to this opportunity and emailed them ahead of time to consider what they might ask Peter Praet that related to their course. On the morning of 8 February at 9:15am (10:15 CET) the University of Leicester School of Business Twitter account experienced a student takeover in the Rattray Lecture Theatre. Professor Demetriades, armed with a list of questions thought up by himself and his students, first put them to a student poll in the lecture theatre. Hundreds of students attend this module and they helped pick which were their favourite questions to put to the ECB. 

Most of the questions answered were from the business and financial communities, including journalists, economists and a member of the European Parliament. Peter Praet replied to two posts from the University of Leicester’s School of Business.

Abdullah Alsubaie, a second year Financial Economics BSc asked:

#AskECB To what extent has the @ecb’s asset purchasing programme (APP) been effective? Which channels have been the most effective? Going forward, do you see it being replaced by any other policies?

To which Peter Praet answered:

Praet: Things are evolving according to our plan. Channels: APP has eased borrowing conditions for firms and households which has boosted job growth and investment. Forward guidance on rates will naturally increase in importance.  #AskECB

This was followed by a question on Brexit by Professor Demetriades:

#AskECB To what extent would a “no-deal” OR “hard-Brexit” constitute a negative shock to the economy of the Eurozone? Could we expect a monetary policy response from the @ecb if either of those adverse scenarios materialises?

Praet’s answer, possibly the most interesting of his 23, was:

Praet: I agree that Brexit is a negative supply shock, which will affect the UK much more than the euro area. The intensity of the shock will depend on the outcome of the negotiations (to which the @ecb is not part!). Given uncertainty contingency planning is essential. #AskECB

Professor Demetriades was delighted with how the lecture went: “This was a fantastic opportunity for students to interact with the European Central Bank. It was a great session and we learnt first-hand about ECB policies and transparency. It helped the students make better connections between the theory about inflation targeting central banks and the practice of monetary policy. We discussed Peter’s answers to all questions except the one about the colour of Mario’s tie! It allowed us to use technology to reinforce what we are learning on the module and was truly 21s century teaching.”

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