Central Banks
People: Turkey nominates new governor; McDermott to step down from FCA
Turkish government picks deputy to replace Erdem Başçı, but he must still be confirmed by the president; UK’s interim FCA chief says she will leave when her successor takes office; and more
Canada holds rate but raises growth forecast in light of fiscal boost
Stephen Poloz highlights “more favourable policy mix” in press conference; central bank notes emergence of “positive forces” in decision
BoE assumes control of interest rate benchmark
Central bank to take responsibility for overnight benchmark, planning to broaden the transactions underpinning its calculation; WMBA to retain role in calculating and publishing figures
BoJ paper attempts to ditch Friedman rule with new model
Paper outlines model where mild inflation is welfare-optimising, in contrast to Milton Friedman’s rule implying mild deflation, which underpins many monetary models
Norges Bank deputy pits Keynes against Hayek
Jon Nicolaisen says European countries may have invoked the lessons of Keynes without paying heed to the warnings of Hayek – both views are needed to avoid problems
Viñals supports negative interest rates in current climate
Financial counsellor believes negative rates are helpful, but there are limits regarding how low they can go and how long they can stay there
Advanced economies could learn from EM counterparts in managing balance sheets, paper says
Composition of advanced economies' balance sheets is aligning in some respects to their EM counterparts, largely as a consequence of increasing size since the financial crisis, paper says
Angolan authorities request help from IMF
IMF to start talks with authorities regarding an economic programme, which one analyst believes exceeds loan received after financial crisis
Competition in treasury auctions reduces bidder surplus, working paper finds
Data from before and after Austria’s entry into the European Union shows increased competition in bond auctions substantially reduces bidder surplus, researchers say
Data dependence catching on, says San Fran Fed president
Market participants have become more responsive to economic news since 2015 in both the US and UK, research by Benjamin Pyle and John Williams finds
IMF working paper assess fiscal councils
Research considers the efficacy of independent fiscal institutions in “taming the deficit bias” that emerged in the 1970s, as well as assessing their performance more recently
Russian first deputy governor warns of dollarisation risks
Russian banks and non-financial companies are creating risk for the economy by demanding foreign currency-denominated loans and deposits, a senior Bank of Russia executive warns
IMF urges action to prevent global economy ‘stalling’ and ease central bank burden
Maurice Obstfeld highlights risk of “widespread secular stagnation” as IMF publishes latest WEO; details fiscal and structural support needed to ease burden on monetary policy
Bank of Mexico to send government 239 billion pesos on back of reserve gains
Some 70% of surplus to be used to pay off outstanding government debt or reduce new issuance, while the remaining money will be used to support stabilisation fund
Mexican deputy calls for ‘proper consideration’ of peers
Mexican deputy stresses need for improved policy communication between advanced economies and emerging markets
Central Bank of Cyprus activates deposit-guarantee scheme for failed bank
Central Bank of Cyprus activates deposit-guarantee scheme for creditors of a bank under administration; FBME's banking licence was revoked following US allegations of money-laundering
Senior IMF figures support nominal negative rates
Negative nominal interest rates can help deliver additional monetary stimulus, senior figures at the IMF "tentatively" conclude
New Moldovan governor takes up post
New governor at Moldovan central bank must deal with after-effects of massive theft from three commercial banks; Sergiu Cioclea previously worked for BNP Paribas
IMF working paper sees regulation as key driver of decline in foreign lending
Research contends regulatory tightening is behind much of the ‘sluggishness’ in international banking since the crisis; exploits survey data compiled in preparation for GFSR