Central Banks
Central Bank of Solomon Islands commits to promoting private sector credit growth
Levels of liquidity “more than adequate”, latest monetary policy review says; central bank to maintain levels of liquidity by continuing to issue bills
Danish economist updates DSGE model with financial frictions
Jesper Pedersen adds imperfectly competitive banking system and housing market to improve model’s ability to explain crises
Banks leaving London for Dublin must be ‘run from here’ - senior Irish official
Central bank planning to recruit more regulators if necessary, Cross tells financiers; hints at possible need to boost salary packages for some staff
IMF: Central Bank of Iran should ‘streamline’ committee membership
IMF assessment warns of committees “dominated” by government agencies; fund stresses the central bank should limit membership to its senior officials and independent experts
RBI’s new MPC cuts rate at first meeting
Debate was “frank, often intense, but always friendly” says governor Urjit Patel, after monetary policy committee votes unanimously for a cut
Book notes: Connectedness and contagion, by Hal Scott
Scott’s argument on the dangers of contagion has many appealing features, although he may be too eager to hand powers to unelected officials, writes Michael Reddell
ECB paper aims to improve small-scale models for assessing policy shocks
Paper outlines a structural factor model, which the authors say better accounts for the asset price impact of monetary policy shocks
EBA dashboard shows capital on the rise but NPLs remain a worry
Regulators’ quarterly risk assessment shows EU banks’ capital ratios have ‘slightly increased’, but loan portfolios remain an issue
US spillovers stronger for some countries than others – IMF paper
Paper assesses how US normalisation will spill across borders, identifying conditions where countries are most likely to be affected
Maskin: technocrats should set eurozone fiscal policy
Harvard economist argues a technocratic body similar to a central bank could set spending and revenue targets in eurozone before allowing politicians to determine the details
IMF financing ‘constrained’ policy space in Ukraine, report finds
Earlier debt financing would have been useful for Ukraine, report says, while praising central bank efforts to stabilise the financial system
BoE paper examines how US banks lend after hurricane shock
Local banks may play an “important role” in a geographically integrated banking system, paper says, despite their greater vulnerability to financial constraints
Independence, liquidity and a level playing field – yet another impossible trinity?
Jesper Berg warns it will likely be impossible to balance the demands of monetary policy independence, liquidity standards and achieving fairness for all banks
BIS research tests leverage ratio with adjusted DSGE model
Authors design a model with both leverage ratio and variable risk-weighted capital requirements, finding a range of benefits to constraining leverage
RBI’s Mundra: pinning down credit-GDP link is tricky
Deputy governor says a host of factors combine to make the link between credit and growth unclear, but the link may reinstate itself as the economy stabilises
DRC central bank more than triples rate amid reserves squeeze
Congo central bank raises headline rate five percentage points as foreign reserves continue to dwindle; economy is suffering from copper slump and difficult external environment
Inflation worries prompt action from Bank of Mexico
Central bank hikes interest rate by 50bps in last monetary policy meeting before the US presidential election; peso proves volatile in face of international events
Global sharia standards desirable, but impractical – Lebanon’s el Gemayel
Complete standardisation impractical, but other options are available, says Central Bank of Lebanon’s Joëlle el Gemayel; Islamic banking landscape is shifting
Time to focus on green finance as Paris Agreement set to enter into force
Central bankers meeting at the IMF next week will discuss mechanisms to unleash private capital for green finance ahead of a Paris climate deal that could enter into force before 2017
Don’t underestimate East Africa’s potential, says Sarb deputy
Eastern region of the continent benefitting from slower inflation and improved regulatory regime, Mminele says; “strict” fiscal discipline must be applied throughout the region
Central banks must do more on green finance – UN report
Current progress is not enough to deliver long-run stability; central banks should work with other stakeholders to align the financial system with climate change goals, UN report says
Draghi defends ECB policy to German lawmakers
Monetary policy not causing low profitability at some German banks, ECB president says; calls on policy-makers to initiate structural reforms
‘Significant progress’ on infrastructure overhaul – RBNZ annual report
Past year saw progress on replacement RTGS system, decision on new securities clearing system and the start of a project to modernise Treasury functions
People: RBNZ appoints new board chair; reshuffle of senior management at Australian central bank
Reserve Bank of New Zealand replaces board of directors’ chair after 10 years at bank; assistant governors swap roles at the RBA as the bank looks to hire new talent; and more