Central Banks
Chilean paper analyses ‘labour wedge’ cycles
The gap between the marginal rate of substitution (MRS) and the marginal productivity of labour (MPL) increases during recessions and is counter-cyclical in Chile, finds research
MAS designates seven domestic systemically important banks
The Monetary Authority of Singapore has identified seven systemically important domestic banks, which will have to locally incorporate their retail operations and meet higher capital requirements
Smaller China banks opt for internal credit risk modelling
Regulation and a rise in bad loans drive small and medium-sized banks to reassess their approach to credit risk management
Longer-term inflation expectations pick up in eurozone
In its latest economic bulletin the European Central Bank shows how some measures of expectations, including the five-year inflation-linked swap rate five years ahead, are recovering
Central Bank of Timor-Leste launches e-payments network
The ‘highly secure private interbank data network’ allows electronic payments to be made and received between any individuals or companies on the same day
BIS economists say investor behaviour key to understanding EM challenges
Hyun Song Shin and Philip Turner consider implications of shift in financial intermediation for emerging markets; part of wider Banque de France review on the subject
Bank of Japan cuts inflation forecast
BoJ retains asset purchases at current levels and says underlying inflation is rising steadily; expects to hit target in second half of 2016
Bank of Spain remodels in light of SSM
Executive commission approves a new structure for bank resolution and regulation, as well as changes to the central bank’s cash management functions
Bank of Portugal initiated administrative proceedings against 25 banks in 2014
Bank of Portugal also concluded 27 administrative offence proceedings during last year, applying fines worth around €0.5 million
IMF paper analyses Islamic banking impact on economic growth
Islamic banking is ‘more flexible against shocks and more inclusive with regards to growth’, finds an IMF working paper
Norway’s oil fund boosted by market rally and weak krone
Fund returns 5.3% in the first quarter, a new record in krone terms, led by strong equity returns and weak currency; fund continues to use clout to encourage ethical decisions by firms
Bank of Mexico delivers $2 billion surplus to the government
The 12.4% depreciation of the peso against the dollar in 2014 had a positive impact on the Bank of Mexico reserves, allowing the central bank to deliver a $2 billion surplus to the government
Riksbank ramps up QE
Asset purchase programme doubled but unexpected rate hold sees krona move higher; Riksbank highlights both signs of recovery and rising financial stability risks in new monetary policy report
Centralising supervision may trigger more integration, ECB paper finds
Working paper suggests centralising supervision could create the need for even more centralisation; calls for ‘perimeter of banks’ supervised by central authority to be flexible
PBoC chief economist dismisses talk of QE
Ma Jun addresses rumours central bank is looking to acquire municipal bonds as collateral in an LTRO-like move to lower financial risk and increase liquidity
Stevens cautious on bail-in efficacy
Reserve Bank of Australia governor says bail-in is subject to a ‘host’ of complexities that could mean it goes less smoothly in practice than regulators would like to believe
Azerbaijan to legislate central bank recapitalisation
Parliament prepares draft law to recapitalise Central Bank of Azerbaijan after foreign exchange losses leave balance sheet in the red
Greek municipalities’ union delays cash transfer to central bank
The Greek government will not be able to tap the municipalities’ funds to pay the IMF until their demands are approved in parliament
Norges Bank’s Olsen backs ‘leaning against the wind’
Øystein Olsen presents evidence in favour of using monetary policy to lean against financial imbalances, which he says smooths inflation and output in the long run
People: Malaysia appoints assistant governor; BoJ board member approved
Bank Negara Malaysia names Mohd Adhari Belal Din as assistant governor, while Marzunisham Omar takes office at the IMF; Japanese government approves Yutaka Harada as BoJ board member
Singapore inflation to ease before rising at end of 2015
CPI inflation could be negative on a year-on-year basis for consecutive months, which MAS says reflects ‘falling car prices, housing rentals, and costs of oil-related items’