Balance sheet
The Treasury could make QE exit faster and smoother
Swapping longer-term bonds for Treasury bills or floating-rate bonds would expedite the process of reducing bloated central bank balance sheets
Big banks’ share prices more sensitive to rate moves – paper
Lower capital ratios diminish exposure to changes in the yield curve, says research
St Louis Fed explains Fed’s plans to unwind balance sheet
Fed expected to stop replacing maturing securities to reduce $4.5 trillion balance sheet
RBI closes in on ‘endgame’ in bank clean-up
Governor Urjit Patel says the central bank’s new powers have allowed it to overcome “severe” moral hazard problems; state-owned banks will need recapitalisation, he says
Ghanaian central bank closes two commercial banks
IMF staff called for action in February over problems at some commercial banks
San Francisco’s Williams: monetary policy has reached ‘limit’
Monetary policy has done all that it can to foster growth, says San Fran president, calling on fiscal policy to now “step up”
The changing composition of central bank balance sheets
Quantitative easing may have been necessary, but it has created worrying distortions and has probably discouraged structural change, while deflecting attention away from ever-greater levels of debt leverage
Fed can no longer ‘wait and see’, says Williams
Waiting to unwind the balance sheet could “overheat the economy”, says San Fran president, who believes the US has “fully recovered” from the recession
Evolution of monetary policy in advanced economies spells trouble for emerging markets – paper
Research explores the impact future monetary policy will have on emerging markets, concluding many will be forced to implement defensive measures
The BoJ’s exit policy and balance sheet risks
The Bank of Japan will need to follow a meticulous sequencing of events as its ‘normalises’ monetary policy, making current concerns about negative equity appear premature
Fed paper: portfolio holdings have ‘statistically significant’ effect on rates
Research studies composition of Fed’s Treasury portfolio and impact on yields from 1985-2016
Brainard cautious over further hikes in interest rates
Fed governor says she will be watching inflation “carefully” over the coming months, stating the unwinding of the balance sheet will begin ”soon”
Inflation data causes rift in FOMC
Fed officials discuss whether incoming low inflation data is “transitory” or is a sign of worrying things to come; minutes outline balance sheet unwinding but date remains unknown
Irish supervisor warns of return to light-touch regulation
Some banks’ handling of liquidity issues is concerning, says Sibley
BoE bloggers suggest central banks could use equity-financed QE
Economists raise ideas for future balance sheet innovations, including digital currencies, helicopter money drops and equity-based quantitative easing
MAS’s Menon plays down record profit figure
The record-breaking profit was due to strong positive currency translation effects and higher investment gains
BoJ's balance sheet surpasses that of the Fed
BoJ's balance sheet exceeds ¥500 trillion, a fraction larger than that of the Federal Reserve in absolute terms, and much larger as a percentage of GDP
Fed minutes shed light on balance sheet shrinkage plan
System of caps would allow gradual reductions in the reinvestment of securities held under the QE programme
Fed should make sure it does not ‘fall behind’ – Mester
US central bank should “remain vigilant” as employment reaches full capacity and the balance sheet begins to unwind; the Cleveland Fed president sees more rate hikes this year
Lesotho launches new core banking system without a hitch
Intellect Design Arena’s QCBS will improve the “operational efficiency” of the African central bank; system will also form the “backbone” of the Central Bank of Armenia’s upgrade
Balance sheet not an ‘active’ policy tool for normal times, says Fed’s George
Reductions in Fed’s balance sheet should be on “autopilot”, says George; establishing a “sound framework” will be important
FOMC mulls ‘predictable’ balance sheet wind-down
One FOMC member says a “minimum pace” should be set for the reduction in mortgage-backed securities; committee will inform the public about its future plans for the balance sheet when the time comes
Fed’s Dudley discusses unwinding of balance sheet
Should reinvestment end “abruptly”, financial conditions would tighten, New York Fed president said; tapering “gradually and predictably” is the way to go, he adds
Fed income drops in 2016
Central bank remits less to US Treasury as interest income declines and operating costs rise; passage of "Fast Act" changes remittance process