The Bank of England experienced difficulties in controlling the 1980s credit boom. One of the reasons was that the Conservative government would not allow the Bank of England to suggest to banks that they should be more prudent in their lending to private individuals. This practice of asking the commercial banks to do things which might reduce their profits was known as

Question

Quizplus · Accepted Answer

Moral suasion refers to the practice of persuading rather than forcing entities to adhere to policy recommendations, often used by central banks to influence commercial banks' behavior without imposing formal regulations.

The Bank of England Experienced Difficulties in Controlling the 1980s