News
Riksbank cuts to new low, despite signs of overheating
Central bank pushes policy rate 15bp deeper into negative territory even as economy moves close to full capacity; board responding partly to policy easing abroad
BoE’s Cunliffe wants more detailed timetable for European reforms
Bank of England deputy governor welcomes ambition and honesty of five president report, published in June; hopes to see more detail on dates in future
Central Bank of Brazil faces ‘policy dilemmas’
Tombini facing tough challenge as inflation rises into double figures while the IMF predicts deeper recession; observers divided on what comes next
People: Mozambique deputy moves to airline; Mervyn King joins Aston Villa FC board
Bank of Mozambique deputy moved from central bank to national airline; former BoE governor joins premier league team board of directors; and more
Yellen says Fed unsure about legal issues surrounding negative rates
Fed chair tells Congressional committee she sees no reason why the Fed could not cut below zero if need be, but legal issues have not been ‘fully investigated’
BoJ moves to ‘ease stress’ in JGB market
More generous limits applied to securities lending facility designed to alleviate strains in the market for government bonds, though liquidity indicators do not show clear signs of tightening
NZ has ample space to respond to risks – IMF staff
An International Monetary Fund staff report says there is room to ease monetary policy further if need be, while authorities should prepare more prudential measures
RBI report lays ground for trading new derivatives
Working group proposes allowing new interest rate options in India to improve financial institutions' ability to hedge interest rate risk
BoE’s Cunliffe: UK may be close to debt sustainability limit
Deputy governor says analysis of recent UK credit cycle suggests rises in debt may leave the economy vulnerable; Cunliffe would consider action if debt-to-GDP ratio rises
China relaxes QFII limits amid calls for capital controls
FX regulator shortens ‘lock-up’ period, during which foreign investors must wait before repatriating funds, from one year to three months
IMF staff call for clarity on Morocco macro-prudential body
Staff report calls on government to clarify powers of inter-agency committee chaired by central bank governor; separate assessment details work on toolkit
German and French central bank heads back creation of eurozone Treasury
Weidmann and Villeroy de Galhau issue joint call for more integrated eurozone, potentially including joint treasury; alternative would mean different approach to sovereign risk
Eurosystem reveals rules on national asset holdings
ECB publishes an agreement governing the size of ‘non-monetary policy holdings’ at national central banks in the eurozone; aggregate net financial assets totalled €490 billion at end-2015
BIS data sheds light on complex shift in global liquidity
There are signs global liquidity might be going into reverse for emerging markets; digging into the data shows situation is more complicated than aggregate figures imply
Ukraine governor reveals move towards inflation targeting
Ukraine’s central bank is already setting policy with an eye on an inflation target while it awaits a formal mandate, its governor says; banking ‘cleanup’ is ‘near the finish line’
BoJ report spells out reasons for dissent on negative rate
Board members had wide range of concerns over cutting rate below zero, including communication challenges, risk of financial instability and danger of triggering a global race to the bottom
Caruana marks out dangerous nexus between debt, oil and the US dollar
BIS chief points to interactions of dollar borrowing by emerging markets, US rate hikes and the oil price, as latest data suggests world may be balanced on the edge of a drop in global liquidity
Italian banking episode shows supervision working well, Nouy says
Handling of problems with Italian banks shows regulators have the right systems in place, Danièle Nouy says; there might be skeletons, but they are ‘not in the cupboard’
IMF staff urge caution on Kyrgyz de-dollarisation plans
Central bank plans to support borrowers with foreign currency exposures, but IMF team warns this must be backed by other policies; action also needed on central bank independence, it says
Clock ticking on Georgian governor appointment
Georgian central bank governor's term expires on February 26, but it is unclear who will hold the post moving forwards; vice governors could also change later in the year
Riksbank pushes for FSA to gain stronger tools amid delays
Amortisation requirement looks set to enter force in June, but more powerful tools for Swedish FSA may be delayed; government says negotiations take time, and it fears triggering crisis
Draghi says ‘risk of side effects’ will not stand in ECB’s way
Mario Draghi says the European Central Bank will not be deterred by the ‘unintended consequences’ of its asset-purchase programme, ahead of a key March governing council decision
Lagarde looking for ways to bolster global safety net
IMF head wants to address ‘fragmented and asymmetric’ safety net that has emerged since the 2008 financial crisis, noting the fund will consider the issue over the next few months
Buch enters reservation on common deposit guarantees
Bundesbank deputy says safeguards must be put in place before a eurozone deposit guarantee scheme can be established, even as Draghi welcomes progress on the scheme