Central Banks
‘Overoptimism’ a factor in house price bubbles, Danish paper finds
Authors highlight how sentiment can become “decoupled” from economic fundamentals under certain circumstances
Dominican Republic central bank hikes despite falling inflation
Central bank action comes as economy grows more than expected, although inflation is well below target; US factors prove a concern
People: Ukraine promotes Smolii to first deputy governor and appoints two new deputies
Banking supervision chief and human resources head join central bank’s board
Draghi and Mersch seek to calm German fears
The ECB’s task will be harder if Germans feel discriminated against, Mersch says; Draghi points to evidence that QE helped German savers
Banks not fully adapted to new prudential environment – BoE deputy
Firms need a “proper chance” to adapt to the “new world”, says Woods, warning that the banking system still looks fragile on some metrics, despite work by his predecessor, Andrew Bailey
Hedging demand can cause covered interest parity violations – BIS paper
US dollar forward hedging demand can cause covered interest parity to fail even when markets are calm, authors say, helping explain this post-2012 anomaly
Ukrainian central bank council holds first meeting
New body has extensive powers over monetary policy and governance; NBU cuts rates for the fifth consecutive time this year
Brazil’s inflation forecasts send mixed messages for monetary policy
‘Market’ forecast suggests there is a limit to monetary easing, central bank minutes show, though ‘reference’ scenario indicates room for more easing
AnaCredit: banking with (pretty) big data
The supranational credit database in Europe will help policy-makers and banks assess cross-border risk when it goes live in 2018, writes Aurel Schubert, director-general of the European Central Bank’s statistics department
HKMA expands offshore renminbi liquidity scheme
List of banks provided with liquidity for offshore renminbi market-making grows, with extra measures designed to boost transparency
Central Bank of Curaçao and Sint Maarten files anti-corruption raid complaint
Central bank questions legal basis for raid and seizure of documents; investigation into alleged tax avoidance by governor Emsley Tromp continues
Ukrainian central bank attacks leading law-maker as political dispute worsens
Central bank governor backed by the ‘reform council’ and the IMF, but the president’s stance unclear
Global crises raise need for digital financial inclusion – BIS’s Caruana
Refugee crisis, climate change, banking challenges and cyber crime all point to the need for better inclusion through the use of technology, says BIS chief
IMF amends SDR calculation method
Exchange rates used to calculate SDR to be obtained from a commercial provider by the Bank of England, in effort to make methodology more “robust”
Lagarde welcomes ‘major policy shift’ in Saudi Arabia
IMF managing director says efforts to reduce reliance on oil are “very welcome”, although Gulf countries more generally need to continue their fiscal adjustment
Commodity prices create ‘strong pressure’ to lower interest rates – paper
Policy response to commodity price fluctuations has been stronger in the US, paper finds; commodity price shocks follow two cycles, with the most recent having impacts on policy rates
RBS issues first polymer banknotes
Polymer note printed on De La Rue ‘Safeguard’ substrate is first in RBS's new series; Scottish novelist and poet Nan Shepherd features on the front of the note
Riksbank signals low rates will stay longer
Swedish central bank says rates likely to remain on hold for longer than planned, with chance of an inter-meeting asset-purchase extension
Sponsored forum: Evaluating big data capabilities in central banking
Central Banking convened a panel of experts to discuss the big questions about big data, how and where it can add value to central banking in the near term, and balancing the pros against the cons
EBA recommends tighter regulation of European banks’ ‘large exposures’
Report calls for stricter limits on bank exposure to single clients and cautions against premature application of “standardised approach” to large exposures
ECB issues latest macro-prudential bulletin
Papers look at second order effects of financial shock, de-risking and high-frequency trades
Bundesbank board member calls for ‘moderate’ consolidation of German banking sector
Dombret criticises German banks for low cost efficiency and outdated business models
Macro-prudential policy can guard against global volatility – BoE paper
Tighter macro-prudential policies appear to reduce the sensitivity of capital flows to global volatility, paper finds
RBNZ moves to publish policy rate forecasts
Central bank scraps forecasts of 90-day bank bill rate as relationship with policy rate has been affected by global regulatory changes