Basel III could distort monetary policy: ECB’s Bini Smaghi warns


Basel III's introduction of liquidity buffers could have unintended consequences on central bank's monetary policy operations, Lorenzo Bini Smaghi, an executive board member at the European Central Bank (ECB), has said.

Bini Smaghi told the International Banking Conference in Milan on Wednesday that changes in banks' behaviour resulting from the implementation of the liquidity buffers may prompt an unexpected change in investment behaviour from short-term assets to longer-term assets, which woul

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