Central Banks
Kansas Fed researchers bridge gap between forward guidance data and theory
Working paper identifies empirical effects of guidance at the zero lower bound, before finding a standard model of price rigidity largely replicates the results
Kosovo’s ELA rules are ‘major improvement’, say IMF staff
Central Bank of the Republic of Kosovo adopts regulation setting out the conditions for emergency fund provision; staff at IMF welcome the additional ‘detail and rigour’
Cyprus on track to complete programme by March, finance minister tells MEPs
Cyprus will continue with fiscal discipline and market-orientated reforms once adjustment programme ends, finance minister tells European parliament; rejects ‘tax haven’ claims
Policy interactions may drive global banking contraction, BoE economists find
The combination of unconventional monetary policy and regulation may cause ‘substantial’ spillovers as banks cut cross-border lending, economists including Kristin Forbes find
People: Tombini takes FSB committee chair; Al-Wazir moves to IMF
Alexandre Tombini is appointed to chair budget committee; former PMA governor joins IMF; Kazakh sovereign wealth fund replaces its chairman; and more
South Korea’s new SWF chief sets sights on ‘top ten’
Former World Bank executive director takes office as CEO of the Korea Investment Corporation; sets out desire to grow assets under management beyond $200 billion
Kuroda and Davos panel see little alternative to divergence
Bank of Japan governor warns a synchronised exit from easy policy in the major economies ‘could be worse’ than the ’staggered arrangement’ at present
BIS paper says trade finance impacts global spillovers
Working paper emphasises importance of including trade finance when modelling global shocks, finding variations in price stickiness are important
Reserve accumulation can be inflationary, ECB paper says
Working paper examines the allocation of special drawing rights in 2009 to separate out the inflationary effects stemming from an increase in the monetary base and moral hazard
Banque de France governor wants public reforms
France must cut its public debt and reform its labour market, says Francois Villeroy de Galhau; the governor also calls for new investment products
ECB’s Cœuré calls for new attitude to liquidity
Liquidity in the European banking system should not return to its pre-crisis levels, Benoît Cœuré tells a Davos audience; CMU offers chance to fix problems which caused crisis, he adds
Revised Basel III better reflects bank risk, research finds
Study says 2013 capital rules more in line with actual risk, but can be easily gamed
Weidmann says clearer liability would strengthen eurozone
Bundesbank chief says important element of fixing the eurozone’s ills is reinstating the ‘principle of liability’, instead of resorting to bailouts
New Bank Negara Malaysia website gets ‘trial run’
Malaysian central bank launches new website for a trial period, before it becomes fully operational by end of March; existing site will remain functional in the interim
Lane reveals string of transparency initiatives in first speech as Irish governor
Central Bank of Ireland discloses new details on salary structures as governor Lane reveals new minutes, reviews and website
Tobacco prices ‘insufficient’ to offset food and energy, says Tonga central bank
Headline inflation in Tonga rose to -1.2% in December, but in its inflation report for November, the central bank warns price increases will likely remain low
BoE’s Weale sees shorter working week adding to inflation
Various measures suggest UK workers will gradually cut back on the number of hours they work over the next few years, adding to unit labour costs, external MPC member says
Issing says eurozone status quo is in danger
Former ECB board member says Europe’s monetary union is still plagued by problems caused by absence of political integration, which could pull the eurozone apart
Analysts see Hong Kong peg under scrutiny
Hong Kong dollar reached lowest level in nearly a decade this week, putting long-standing peg ‘under fresh scrutiny' and prompting fears of possible attack
IMF staff back Moldovan central bank response to crisis
Staff report supports many actions taken by the Moldovan central bank in dealing with the crisis caused by banking fraud; calls for bank to gain more powers and independence
ECB will 'review and possibly reconsider’ stance in March
ECB policy rates and asset-purchase programme remain unchanged, but Draghi says council was ‘unanimous’ in agreeing it should announce March review
BIS stats show further retreat in global banking flows
Falling claims on China drive bulk of overall reduction in cross-border claims, but pace of decline slows compared with previous quarter
BoJ research estimates impact of Olympics on growth
Authors suggest Tokyo Olympics will boost Japan’s annual real GDP growth by 0.2-0.3 percentage points from 2015-2018, as tourism and construction investment picks up
Regulators need better grasp of electronic trading, BIS committee says
Rapid growth of electronic trading in fixed-income markets demands more sophisticated regulatory analysis, Markets Committee says; new risks may be developing