Trade
Book notes: The cost of free money, by Paola Subacchi
A book worth reading, as it facilitates further discussion on substantial issues, but doesn’t fully address some of the problems it takes aim at
Myanmar and China to use renminbi for cross-border trade
Reports indicate that authorities will pilot settling small-scale trade transactions in yuan
Trade credit helped amplify initial Covid-19 shock – BdF paper
Net borrowers of trade credit faced sharper liquidity squeeze, researchers find
Pakistan confronts inflation with 100bp hike
Third consecutive increase may be last for a while, MPC says
Alternative data fuels central bank research
Important research areas include monetary transmission, exchange rates, digitisation, SMEs and climate change, against the backdrop of Covid
Book notes: Empire of silver, by Jin Xu
A useful introduction to China’s monetary history, focusing on the last 1,000 years, but not the easiest of reads throughout
Uruguayan central bank orders third consecutive rate hike
Central bank expresses concern over salary rises and regional uncertainty
BoE surprises with rate hold as inflation forecasts reach 5%
Market-implied path for interest rates rises to 1% by end-2022
North Korea issues coupons instead of cash
Experts say closing of Chinese border due to Covid-19 may have halted banknote production
Paraguay’s MPC hikes rates by 125 basis points
Country follows Chile with unexpectedly large tightening as inflation continues to rise
James Bullard on Fed policy, action and governance
St Louis president calls for tapering amid “exceptional” job market and risk of “more persistent” inflation, quantifies ‘big tent language’ for pioneering AIT move, and details Congress’s role in Fed ethics oversight
IMF: growth prospects dim as pandemic lingers
Fund revises down growth forecasts, warning of inflation, disruption and divergence
Covid-19, crypto and climate weigh on global economy – GFSR
Central banks face difficult “intertemporal trade-offs”; poorer nations unlikely to regain pre-Covid growth levels for “many, many years”, says IMF’s financial counsellor Tobias Adrian
Larry Summers on stagflation risks, lessons from Delphi and never-ending ‘punch’
The former US Treasury secretary speaks about fiscal ‘overexpansion’, Fed/Treasury debt discord, the pitfalls of ‘unknown unknowns’ and central bankers ‘unable’ to remove the ‘punchbowl’
Authorities should consider stress-testing global supply chains – BoE paper
While global supply chains have not changed much, the shocks impacting them have, researchers say
Agustín Carstens on BIS strategic priorities, innovation and central bank policy
The BIS general manager speaks about policy trade-offs at critical time, tackling NBFIs and the dearth of ‘green’ assets, tech collaboration, and why he favours Biden’s $3.5trn infrastructure bill
Book notes: Robert Triffin, by Ivo Maes with Ilaria Pasotti
Triffin’s story is well told by Maes, whose extensive personal and academic research shines through on page after page
Brazilian minister says Mercosur could have single currency
President has also suggested monetary union with members of trade area
Book notes: The pay off, by Gottfried Leibbrandt and Natasha de Terán
A timely introduction to and accessible survey of payment system developments
Bank Indonesia bolsters FX settlement with Japan and Malaysia
BI continues to promote local currencies in a bid to “reduce dependence on the US dollar”
‘Unstable, unreliable and temporary’: paper explores global co-operation
Policy-makers should heed JM Keynes’ 1919 warning, say Michael Bordo and Catherine Schenk
The IMF’s $650bn SDR allocation and a future ‘digital SDR’
Focus is needed on widening SDR use in payments and the creation of a ‘digital SDR’, to support a large allocation of ‘official’ IMF SDRs, writes Warren Coats
Technology is the best bet in fighting money laundering
Danish FSA chief Jesper Berg says there is a need to think ‘outside the box’ on AML, rather than blame flawed regulatory and institutional design in dealing with corrupt money flows
Vietnam central bank and US Treasury sign currency pact
US had briefly labelled Vietnam a “currency manipulator”