Financial Stability
BIS: Top-down approach to countercyclical capital buffers preferred
Bank for International Settlements paper on capital buffers says a bottom-up approach is more favourable to a top-down as bank specific factors neglect variable differences in capital structures of firms
Bank of Italy: north hit hardest by crisis
Bank of Italy study says geographical differences in growth reflects dependence on industry
Crisis makes Tokyo more insular
In the first of a six-part series on the Japanese economy, Robert Pringle reports from Tokyo on how the crisis has impacted the nation’s global outlook
Lending in Japan remains subdued: BoJ survey
Bank of Japan survey on bank lending reports continued weakness in demand for loans by firms
Dodd-Frank starts to bite as Obama signs bill into law
US President Barack Obama draws a line under year-long legislative process, hailing bill’s benefits to consumers; ratings agencies flustered by exposure to ‘expert liability’
ECB will always end up bailing out sovereigns: Buiter
Former Bank of England rate-setter Willem Buiter says ECB will lose in “game of chicken” with finance ministries over who rescues sovereigns
Hungary prepares bracing bank tax, wage caps
Hungarian parliament set to approve hefty bank levy to shear budget deficit; public sector wage freeze will affect central bank employees, despite ECB protests
Laos to liberalise cross-border transactions
Laos notifies IMF that it accepts plans to adopt measures that will end restrictions on international payments and transactions
US deposit insurance ceiling permanently raised to $250,000
Dodd-Frank law makes temporary $250,000 limit permanent; Federal Deposit Insurance Corporation says new law will apply retroactively
Faulty paper halts note production at De La Rue
Banknote printer De La Rue suspends production at its Hampshire plant owing to paper fault; shares plummet on company statement that 2010 production and sales will be affected
BoE: UK consumer confidence continues to slump
Bank of England field survey on business conditions shows consumer sentiment slightly weaker in second quarter of 2010 as sales declined
Japan’s Yamaguchi apprehensive of Asian expansion
Bank of Japan deputy governor Hirohide Yamaguchi says emerging economies must be aware of overheating
RBA’s Stevens: Economic downturn will have long lasting implications
Reserve Bank of Australia governor Glenn Stevens says financial crisis will have longer lasting impacts to advanced economies
Price stability rightly remains sole focus of monetary policy: IMF
Fund directors say macroprudential measures, rather than monetary policy tools, should deliver financial stability; propose measures including dynamic provisioning framework
Estonia upgraded on euro accession; Ireland knocked down on banks’ weakness
Fitch lifts Estonian credit rating two notches, citing benefits of eurozone membership and strong fiscal performance; Moody’s downgrades Ireland on poor growth projections, worries over bad bank
Volcker philosophical on weakened rule, reform bill
Former Fed chairman Paul Volcker says failure to include dollar limit on banks’ positions in hedge funds “disappointing”, but accepts need for political compromise
Nigeria’s bad bank comes to life
Nigerian President signs bill approving creation of bad bank to take $10 billion in toxic loans off beleaguered banks’ balance sheets; agency to be up and running by end-September
IMF on Peru’s de-dollarisation experiment
IMF uses Peruvian experience in last decade to show benefits of de-dollarisation policies
Bank of England – Trends in Lending (July 2010)
Bank of England’s July lending report shows further declines in bank loans as demand continues to weaken
Bank of Japan – Monthly Report of Recent Economic and Financial Developments (July 2010)
Bank of Japan report shows boost in export growth was undermined by chronic deflation problems
HKMA unveils design of two new banknotes
The Hong Kong Monetary Authority says improved security features on new banknotes will reduce counterfeits in circulation
ECB identifies dark side of wholesale funding
European Central Bank study finds that despite benefits of wholesale funding, liquidity scares can cause instability to banks that are uninformed of potential risks
Fed better prepared than us for financial crisis: ECB paper
European Central Bank study shows stronger emphasis towards output allowed the Fed to react faster than Frankfurt to financial crisis
Central Bank of Ireland – Payment and Securities Settlements System Infrastructure Report (July 2010)
Irish central bank’s report on payments and settlements shows country is behind Europe in transition to electronic payments systems