Central Banks
Chinese financial spillovers to Asia-Pacific on the rise – BIS paper
Working paper finds Chinese equity markets now have almost as much of an impact on Asia-Pacific as the US, though the effects differ in stressed and placid times
Boston Fed’s Rosengren highlights risk of overheating
US economy looks “resilient”, despite some mixed signals from the data, says regional Fed president; advocates process of gradual rate hikes as the risk of an overheating economy grows
ECB consults on bad debt guidance
ECB “strongly encourages” the use of the European Banking Authority’s definition of non-performing exposures, but does not impose its own single measure for the eurozone
Azerbaijan central bank raises rates for fourth time this year as currency plummets
Falling oil and gas prices have major impact on Azerbaijan’s economy; IMF calls for major banking sector reforms
BoE’s Shafik to step down early
Deputy governor reveals she is to take up post as director of the London School of Economics in 2017, leaving the central bank more than two years before her term was due to end
PBoC faces the ‘most challenging work of all central banks’ – HKU’s Xiao
The People’s Bank of China needs to meet short-term goals of exchange rate and price stability to achieve longer-term structural and financial reform, says Hong Kong University professor Xiao Geng
Book notes: And the weak suffer what they must?, by Yanis Varoufakis
A book that is likely to elicit strong opinions – but Varoufakis writes persuasively, and may well win over many of his readers, says David Mayes
ECB paper finds ‘sizeable’ impact from QE
Authors find empirical evidence of various channels through which asset purchases affect the eurozone economy, before testing them in a general equilibrium model
IMF’s Singh urges central banks to beware of collateral impact of policy
Senior economist says asset purchase programmes have drained quality collateral from the system, damaging the economy’s “financial plumbing”
Falling natural rates impacted by common global factors – Fed paper
Research by Kathryn Holston, Thomas Laubach and John Williams finds no sign of natural rate decline reversing; advanced economies jointly affected by global factors
Fed finalises rules for countercyclical capital buffer
US central bank promises it will only adjust the buffer gradually and will seek comment before doing so, after consultation flagged concerns
Fiat currencies stand firm against bitcoin
The cryptocurrency is a victim of its own success as strong demand pushes its price up, increasing speculative flows
‘Neural network’ could help construct early warning systems – Colombian paper
Model can detect identity of bank by analysing features of its balance sheet, which the authors say can be coupled with other financial stress indicators to help classify banks by their fragility
Bank of Finland looking to streamline and upgrade payments simulator
Economist sheds light on the bank’s plans for adding new features, improving efficiency and integrating agent-based modelling
Changes to central bank law mooted in the Philippines
Proposed changes include oversight of more financial institutions as well as the capacity for the central bank to place harsher sanctions on illegal transactions
RBA’s Lowe: credit not enough to measure financial cycle
Deputy governor says the financial cycle’s “considerable intuitive appeal” needs to be backed up with better research on measuring cycles, with balance sheets likely to play a key role
ECB delays decision on policy redesign
Mario Draghi says committees will investigate “smooth implementation” of asset purchases, but offers no new policies today; highlights signs of greater willingness for government action
Rates likely to stay on hold, says Chilean monetary policy report
Inflation expected to be in the target range by year-end, latest monetary policy report forecasts show; no need for new hikes if economic trends continue
George and Lacker push back against calls for Fed governance reform
Presidents say mixed public-private funding and governance helps protect the independence of the regional Feds, though others warn private banks are having too much say in policy
People: Turkish deputy appointed; Dominican Republic governor and deputy to serve again
Former HSBC and Citigroup banker joins the ranks of the Central Bank of Turkey; long-standing Dominican Republic governor and deputy invited to serve again; and more
The arrival of web-first publications
Websites have become the primary channel for distributing central bank publications, with PDF being the format of choice. The BIS's Christian Beslmeisl asks whether central banks could do better
Kganyago justifies Sarb’s response to ‘troubling mix’ of issues
Sarb governor says the public should be “satisfied” but not “happy” with the current economic outlook, given that monetary policy has only offset some of the problems causing high inflation