The medium term financial strategy: an experiment in co-ordinating monetary and fiscal policy

<p>In the budget of 1980 the current administration launched the Medium Term Financial Strategy (MTFS), a four year plan designed primarily to reduce inflation but also to generate economic growth, see FSBR (1980). What is not immediately apparent from the name is that it is as much a fiscal strategy as a financial strategy; indeed what it seeks to do is to co-ordinate the stance of monetary and fiscal policy in a fashion novel to the post-war UK economy. IN the 1981 budget, the strategy was modified in detail, but re-affirmed in principle.</p>