Central Banks
Fed keeps options open as countdown to lift-off begins
FOMC drops the reference to being ‘patient’ before normalising policy, signalling a rate hike could arrive as early as June, but tempers expectations with more cautious economic assessment
SNB balance sheet could not have coped with peg defence, says Jordan
Chairman says decision to abandon Swiss franc ceiling avoided huge losses and monetary policy impairment; central bank slashes inflation forecast but does not follow Riksbank’s rate cut
New Australian banknotes to feature 'embossed bumps'
RBA to become second central bank to emboss polymer banknotes with 'bumps', making it easier to feel the difference between denominations
Banks could face fines of $4bn from US DoJ
The fines being hammered out would nearly double the total already paid to regulators during the currency probe
BoE minutes highlight risks from sterling strength
MPC members raise concerns over divergence of monetary policy and the resulting strength of the UK’s currency, which has the potential to hold inflation lower for longer
Denmark eases pressure on banks but stays tough on krone peg
National Bank of Denmark raises limits on current account deposits to ease pressure on banks after forex interventions, but stresses speculators will lose if they continue to attack the krone peg
RBA research finds CCP rules are effective in containing severe shocks
Paper tests central counterparties under extreme ‘tail of tail’ scenarios and finds new rules designed to promote their stability are effective
Sri Lankan governor ‘on leave’ during government inquiry
Arjuna Mahendran is taking a period of leave while the government investigates the practices around Treasury bond auctions at the central bank; only appointed in January
BIS charts ‘boundaries of the unthinkable’ as risks rise
Quarterly review flags growing vulnerabilities and signs of credit booms in some economies; research finds limited impact of deflation on growth, pointing to importance of financial sector
IMF paper warns against ‘overburdening’ LatAm central banks
Working paper studies evolution of central banks in Latin America, and warns against jeopardising the credibility they currently enjoy by handing them new mandates
Protestors clash with police as ECB opens new premises
Demonstrations organised to coincide with inauguration of new ECB building lead to outbreaks of violence; Draghi calls for economics and politics of integration to be ‘reconciled’
BoE’s Brazier sees room for improvement in stress testing
New executive director outlines enhancements including counter-cyclical testing and extending the regime to the non-bank sector
Finnish paper charts evolution of PBoC policy since 1999
Discussion paper asks whether China has shifted toward a ‘price-based policy’ and finds the PBoC has become more responsive to changes in economic conditions in recent years
Gradual rollout for China's payment system
The country’s cross-border interbank payment system will further contribute to the internationalisation of the renminbi
Paper examines role of capital in BHC lending decisions
Authors find an increase in capital requirements of bank holding companies is ‘likely’ to increase the interest rate charged on loans, resulting in a ‘significant’ reduction in lending
Bank of Israel studies economic damage from conflict
Latest hostilities between Israel and Palestine cost the Israeli economy around 0.3% of GDP, with effects stemming from falling tourism and lower consumption, annual report finds
Lagarde tells emerging markets to prepare for US rate hike
Emerging markets can expect trouble if the Fed raises rates this year, says IMF managing director; BIS research implies economies can harness the benefits of spillovers with the right policy mix
Draghi wants shared sovereignty over structural reforms
ECB president fleshes out vision for ‘common governance’ of product and labour market reforms in the eurozone; advocates adopting an ‘institution-based approach’ to common governance
BoJ sees inflation remaining at 0% for 'the time being'
Central bank to fall short of 2% inflation target in April as consumer prices stagnate on back of lower oil prices; more easing unlikely, says analyst
Spanish paper analyses impact of securitisation on bank capital structures
Securitising banks ‘increase their loan volumes and their ratios of loans over total assets,’ changing their business model, working paper finds
Vanoli says Argentina seeking alternatives on bonds
Argentina is looking for financial entities that are not affected by the New York judge rulings and can help the country issue new debt, central bank governor says
RBA’s Debelle tackles term premia puzzle
Guy Debelle says the most plausible explanation for the prevailing low level of term premia in global fixed income markets is the shortage of risk-free assets
Cyprus governor 'will not resign' despite political pressure
Chrystalla Georghadji will continue exercising her duties as governor despite the Cypriot president ordering an investigation into what he perceives as a ‘conflict of interest’
Bank of Spain administrators file for Banco de Madrid bankruptcy
Spanish central bank announced today Banco de Madrid has filed for bankruptcy after a large withdrawal of funds ‘affected its ability to meet its obligations in a timely manner’