Monetary Policy
Bundesbank board member wary of flexibility in fiscal rules
Carl-Ludwig Thiele calls for more "balance" between liability and control in the eurozone, stressing the importance of enforcing fiscal rules
Draghi: too early to judge impact of global events on eurozone inflation
Mario Draghi says slowing growth in EMs, strong euro and weak commodity prices have ‘renewed downside risks’ to outlook; Peter Praet says eurozone still ‘going through correction phase’
Belgian and French central banks get larger role buying asset-backed securities
The ECB makes the National Bank of Belgium the second central bank authorised to buy bonds under its asset-backed securities purchase programme; Banque de France role expanded
Belgian paper explores link between monetary policy and risk-taking
Model suggests central banks should stabilise the path of the real interest rate more when there is a ‘risk-taking channel’ of monetary policy, to help reduce ‘welfare detrimental fluctuations’
Riksbank paper takes stock of macro-prudential landscape
A survey of the empirical literature on macro-prudential policy says various tools work best in different contexts; more research is needed on combining macro-prudential and monetary policy
Poloz expects Canada to manage adjustment well
Bank of Canada governor says the floating exchange rate will help the country to adjust to the resource price shock, while reducing the disinflationary risks that come with it
Limited case for leaning against the wind, says IMF report
Staff conclude the short-term costs of using higher interest rates to address financial risks exceed the longer-term benefits in most cases, but stress door should ‘remain open’
Fed presidents talk up prospect of 2015 hike
Richmond, St Louis and San Francisco reserve bank presidents offer thoughts in wake of last week’s decision to hold rates; all suggest a hike in October or December will likely be appropriate
Haldane weighs solutions to ZLB constraint
Andrew Haldane considers benefits and costs of adopting higher inflation targets, accepting QE as a conventional policy tool and creating central bank-issued digital currencies
Riksbank research suggests inflation correlated with policy rate in some cases
Research by two Swedish economists uses the work of Irving Fisher to illustrate how low policy rates might be leading to low inflation in some countries; cites Irving Fisher for causal explanation
Fed holds off rate increase but outlook largely unchanged
The majority of Fed governors and presidents still expect a hike this year, but concerns over global outlook and domestic inflation prompt FOMC to hold fire for now
ECB allows national central banks to disclose ELA provision
Bank of Greece becomes first central bank to make use of power to disclose ELA figures
Japan lashed by the Fed
The Abe government is using a questionable reading of history to justify policies that are increasing rather than reducing the gloom over Japan’s prospects
RBA board holds off judging impact of volatility on trading partners
The board assessed the troubles in China and market volatility to have ‘increased the downside risks’ to the global outlook at its meeting this month, minutes show
Russian governor weighs exchange rate pass-through
Elvira Nabiullina discusses the bank of Russia’s estimates for how much the depreciation of the ruble will impact inflation, conceding prices have increased faster than expected
Liikanen discusses logic behind publishing ‘accounts’
Bank of Finland governor says it is important central banks exhibit a ‘high degree’ of transparency, noting the ECB decided to begin publishing accounts as policy became more unconventional
BIS research finds US policy spillovers ‘significant’
Article examines the spillovers from short-term, long-term and policy rates in the US on a host of emerging and advanced economies; impact is economically and statistically significant
PBoC makes reserve requirement ratio more flexible
China's central bank will change method for calculating banks' reserve requirement ratios tomorrow in a move one analyst says could free up $200 billion
BoE’s Forbes calls for rethink of exchange rate pass-through
MPC member outlines new, more nuanced approach to measuring the exchange rate’s impact on inflation, noting this implies rates could need to be tightened sooner than older models suggest
Cœuré warns ‘serious data gaps’ still exist
ECB executive board member says serious gaps, inconsistencies and inefficiencies still exist in many areas important for monetary policy and financial supervision
Gaza blockade adds to leap in Palestinian inflation
Low oil prices are not fully offsetting a fuel crisis in the Gaza Strip as a continued blockade causes rapid price rises in certain goods, a Palestine Monetary Authority inflation report finds
Kocherlakota considers impact of public debt on long-run interest rate
Minneapolis Fed president says an increase in public debt could help increase long-run neutral rate, allowing the FOMC to raise rates quicker, but it would come with costs
RBNZ cuts OCR again in face of ‘softening’
Graeme Wheeler reiterates ‘some further easing in the OCR seems likely’ as he reveals the third consecutive rate cut; RBNZ notes importance of Chinese demand to commodity prices
Bank of England wary of China risks but UK outlook steady
The MPC’s view is not materially affected by recent volatility in the financial markets as it keeps policy on hold; domestically, an increase in wage growth is offset by higher productivity