Financial Stability
EU survey calls for more cohesion on cloud computing
There appears to be a lack of clear and formal guidance from financial supervisors on banks’ use of cloud-based IT services, while their use is underestimated, an EU agency says
Banks may need major overhaul to handle new disclosures, FSB task force says
Many banks will need to make ‘substantial changes’ to systems and processes to cope with new and more complex standards on accounting for expected credit losses, report finds
South Africa evades recession with positive growth in third quarter
Agriculture sector remains a concern despite economic growth in third quarter, most recent Sarb quarterly review notes
BIS: Artificial calm in markets cannot last
Quarterly review presents latest evidence of fault lines running through financial markets; Claudio Borio says tension between market behaviour and underlying conditions must be resolved eventually
Leverage ratio as high as 5% could yield net benefits, BIS economists say
Authors say there is ‘considerable room for manoeuvre’ when it comes to setting a leverage ratio above the current Basel III minimum of 3%
Mexican paper sees need for ‘combination’ of policies to reduce informal labour
Measures to reduce entry barriers to and relative value of formal labour could be in order, working paper published by Bank of Mexico finds
ECB changes euro FX reference rates' publication time
ECB will change the time of its publication of the euro’s foreign exchange reference rates to help ‘safeguard integrity’; further changes may be made if transactions linked to the rates do not fall
Carney says reciprocity ‘central feature’ in ESRB framework for spillovers
ESRB analysis shows domestic policies can be more effective if their spillovers are managed; Carney says framework for doing so will be operational ‘early next year’
Argentina’s president elect aims to dismantle complex capital controls
‘Macri-economics’ could consist of unwinding capital controls, boosting export competitiveness and unifying exchange rates, but it will be a challenge, observers say
Policy-makers need better models and data on bank and non-bank links, Fischer says
Data on a range of activities remains ‘inadequate’, while research has only shed ‘partial light’ on issues surrounding troubled financial institution during the crisis, Fischer says
Bloomberg to chair FSB’s climate change task force
Financial Stability Board says industry-led task force will develop recommendations for consistent climate-related financial risk disclosures; ex-New York City mayor to chair group
RMB now second most used payments currency between China and Japan
The Chinese currency more than doubles share of payments between China/Hong Kong and Japan in two years, eclipsing US and Hong Kong dollars while yen retains number one spot
Bank of Israel unveils real-time payments plan
New payments infrastructure will support push for advanced electronic payments; committee chair identifies plans for wide range of payments improvements, including real time
Bank of Russia presents strategic plan for financial sector
Bank of Russia aims to create financial ombudsman, update regulatory regime and develop bond market as part of first strategic development plan
Sarb deputy sees opportunity for reserve managers in Fed hike
Daniel Mminele encourages reserve managers to focus on the ‘investment horizon’ to take advantage of higher yields in the wake of Fed action
Advice can affect clients' mortgage choices, says BIS paper
Banks may ‘steer’ households towards certain mortgage types; distorted information has a stronger affect when prices are not adjusted
Norges Bank paper proposes linking CCP risk management to capital charges
Author recommends stress tests of CCPs to gauge interconnectedness, and proposes higher capital charges for CCPs with weaker risk management
ECB survey finds ‘access to finance’ least of eurozone SME problems
The European Central Bank’s survey of eurozone enterprises finds deleveraging is continuing at a slow pace while few firms rate lack of access to finance as their major problem
Irish central bank will persist with housing measures despite public dissent
Chief economist of Ireland’s central bank says it will continue with macro-prudential measures despite public criticism; academic says measures will help slow prices but are ‘insufficient’
Historical data supports fiscal theory of the price level, Bundesbank paper argues
Data from the US, Germany and Italy give policy-makers useful data on the long-term influence of fiscal policy on inflation, a Bundesbank discussion paper argues
Peer-monitoring can help identify ‘distressed’ financial institutions, paper says
Colombian working paper presents early warning system which looks at the liquidity price market participants charge one another
BoE plans capital framework redesign
The central bank hopes the realignment of capital requirements from individual banks to a system-wide buffer will simplify the framework and allow the FPC to respond to threats earlier