Monetary Policy
Asmussen: Eurozone governors should ‘withstand' pressure of public minutes
ECB executive board member Jörg Asmussen says eurozone central bank governors should be able to withstand the pressure of having their deliberations and voting made public
Bank of Mexico deputy welcomes QE taper
Manuel Sánchez singles out downshift in yield curves pushing domestic interest rates for different maturities to all-time lows as the biggest effect of lax monetary conditions on emerging economies
San Francisco Fed president warns asset price bubbles are ‘here to stay’
John Williams discredits economic theory on asset price movements; says bubbles are inflated predominantly by expectations of future price increases
ECB pushes banks on ABS reporting
European Central Bank raises the reporting bar for banks looking to use securities backed by SME loans as collateral; sets October deadline for more detailed disclosure
IMF paper says ageing populations are dampening impact of monetary policy
Working paper says monetary policy is becoming less effective in advanced economies undergoing demographic shift; calls for policy-makers to adapt
US jobs data disappoint raising doubts over September taper
Unemployment fell to 7.3% in August, but modest improvement in jobs data eclipsed by big negative revisions of June and July figures; analysts split over how numbers affect Fed's decision to taper QE
G-20 leaders vow co-operation to avoid monetary policy spillover
St Petersburg summit sees IMF concede advanced economies are now the major engines of global growth; European banking union is a top priority in the G-20's joint ‘action plan'
FOMC policy rate guidance pushes up US equity prices
Netherlands Bank research paper finds policy rate guidance also leads to significant reduction in implied volatility for US government bonds
Fed minutes ‘significantly affect’ US asset prices
New York Fed economic policy review finds that US asset price volatility increases when the Fed releases minutes from policy meetings, but less so since FOMC has become more transparent
ECB holds rates as Draghi is ‘caught between doves and hawks'
ECB sticks to forward guidance as eurozone recovery deemed too 'green' to warrant a tightening of policy; announcement is imminent on the single supervisory mechanism
Fed presidents opposed as September meeting nears
John Williams backs reducing asset purchases ‘later this year’ while Narayana Kocherlakota says the Fed should be providing ‘more stimulus… not less’
Riksbank holds rates as IMF sees ‘sizeable' risks at Swedish banks
Interest rates held at 1% as Swedish central bank attempts to support growth without adding to household debt stock; IMF Article IV report frets over large and vulnerable financial system
BIS economists find Fed's QE helps curb tail risk perception
Paper published today finds the effect of the Fed's announcing unconventional monetary policy measures is strongest when used in conjunction with forward guidance on low interest rates
BoE and BoJ shun further easing as economic activity picks up
Both the Bank of England and Bank of Japan keep their interest rates and asset purchases unchanged as their respective recoveries work up a head of steam
NY Fed staff say effect of policy changes depend on risk environment
New staff report argues that macro policy announcements affect asset prices to different extents depending on the existing economic outlook; when risk is elevated, the impact is reduced
Haldane says central banks have ‘further to go’ to improve communication
Bank of England executive director Andrew Haldane says policy-makers are still searching for a language that resonates with the general public
New York Fed paper wary of higher inflation targets
Staff report finds that pursuing a higher trend rate of inflation would likely create a ‘more volatile and unstable’ economy and unseat inflation expectations
BIS papers study effects of monetary and fiscal policy shocks
Researchers find fiscal shocks within the eurozone lead to a real exchange rate appreciation through inflation differential; monetary policy shocks have minor impact on commodity prices
East African central banks take different approaches to rising inflation
Bank of Uganda hikes key rate by 100bp to 12% as food shortages push crop prices up by 16% in August; Central Bank of Kenya dismisses own inflationary pressures and holds rates
ECB's Cœuré defends OMTs in Berlin speech
Executive board member tells German audience that OMTs do not remove the incentive from governments to reform, and says risk transfer within the monetary union is unavoidable anyway
RBA quiet on further easing as it holds rates
Reserve Bank of Australia holds its key policy rate at 2.5% and omits earlier guidance on the prospect of an additional rate cut from accompanying statement
Net lending to UK businesses still negative, BoE data shows
Second quarter figures for the UK's Funding for Lending scheme shows credit creation remains subdued; Bank of England attributes weak performance to alternative funding sources
Segmented structure of Russian interbank market leads to volatile interest rates
Liquidity-absorbing and liquidity-provision operations are conducted by the biggest banks, reducing credit risk but also restraining market development, according to Bank of Finland discussion paper
Polish paper presents new method for constructing fan charts
Fan charts are an increasingly popular tool for depicting forecasts; working paper proposes a new method for formulating the charts that incorporates 'a mix of judgment and statistics'