United States
Tajikistan objects to Basel Institute’s anti-money-laundering criticisms
The Basel Institute’s grading of Tajikistan as the third-worst money laundering jurisdiction in the world is based on an “absolutely incorrect analysis”, the country’s central bank says
San Francisco Fed chief calls for policy target re-think
John Williams calls for central banks to consider raising their inflation targets or replacing them with nominal GDP targets; lower natural interest rates seem “poised to stay”, he argues
US enforcement actions stopped worse borrowing terms during subprime crisis, paper argues
Researchers compile database matching US enforcement actions to banks and their loans; price, duration and size of loans improved following enforcement actions, they argue
US unconventional monetary policy most effective in financial crisis, paper argues
Conventional and unconventional monetary policies in the United States work through distinct channels, with different levels of effectiveness in crisis conditions, researchers argue
IMF paper explores link between imports and pro-cyclicality of productivity
Research finds firm-level import decisions explain “non-trivial” fraction of fluctuations in aggregate productivity in South Korean manufacturing sector between 2006 and 2012
Regulation may be fuelling covered interest parity breakdown – BoJ economists
Authors link puzzling breakdown of CIP to regulations including liquidity constraints, as well as divergent monetary policies
BIS paper digs into complex spillovers from US rates
Authors find short-run US rates have little impact on long-term rates elsewhere, but transmission at longer maturities and via bond markets is high
Rise of services in advanced economies weakens transmission of monetary policy, paper argues
The transmission of monetary policy in advanced economies is weakened by the greater prominence of services, a Bank of Spain working paper argues; researchers use data from US
IMF’s response to self-evaluation report ‘very positive’
Engagement with evaluation "very positive", says IEO official, after it offered broad support to recommendations, with some qualifications
Philadelphia paper explores drivers of bankruptcy decisions
Working paper examines the extent to which the structure of a household’s balance sheet and income statement influences its decision to file for bankruptcy in the wake of an income shock
Boston Fed seeks ‘more welcoming front door’ with new website
Federal Reserve Bank of Boston launches new website embracing responsive design; new navigational system focuses on four elements of its work
Dudley: market expectations may be ‘too complacent’
Federal Reserve Bank of New York president says the Fed will probably need to hike more than once before the end of 2017 if the economy evolves as expected; warns of "insufficient weight” on upside
IMF’s crisis performance criticised by internal review
Report evaluates IMF’s handling of eurozone crises from 2010 to 2013; work during programme design and implementation described as ‘uneven’ and concerns raised over political pressure
European banks’ structure helps drive dollar-denominated debt issuance – paper
Bank of Spain paper examines the most prolific dollar-denominated debt issuers among European banks, finding issuance is driven by range of factors, including desire to hedge
Fed holds as near-term risks ‘diminish’
FOMC says near-term risks to US outlook have diminished, while economic activity is expanding at a “moderate pace”; keeps policy unchanged, but statement sees increasing odds of a hike this year
BoE prize-winning research favours CCB over leaning against the wind
Authors from Lancaster University find credit spread-augmented Taylor rule damages welfare, while a recent BIS paper takes a different analytical approach
Atlanta Fed paper demonstrates signalling mechanism in mortgage market
Lenders in mortgage market able to reveal quality of loans by delaying trade, authors find; loans sold five months after origination less likely to default
MAS announces ‘firm regulatory actions’ against multiple banks
Monetary Authority of Singapore finds “control failings” at DBS, Standard Chartered and UBS as part of probe into 1MDB funds; US Department of Justice seeking to recover $1bn in assets
Growth risks push Mauritius MPC to cut by 40bp
Central bank cuts interest rates to 4%, amid risks arising from Brexit and potential volatility from US elections; reducing rate will support investment and encourage growth, says bank
Mortgage interest tax deduction can increase market volatility – DNB paper
Making interest payments on housing loans tax-deductible can raise the debt levels of households and their chances of default, and increase housing market volatility in response to outside shocks
FSB calls for more progress on risk-free reference rates
The FSB says authorities have made progress towards reforming reference rate methodologies, but says they must continue to develop alternatives to the existing main reference rates
ECB paper presents ‘news’ and ‘noise’ model of US housing market
A new model of the US property market differentiates between “news and noise shocks”; latter can have significant effects and policy-makers should consider pro-cyclical property taxes, author says
IMF paper explores impact of financial development on wealth dispersion
Authors focus on China between 1995 and 2002; suggest lower access barriers and a deeper market can “greatly improve” welfare
Technical issue affects Fed minutes release
Error in Federal Reserve equipment results in early release in some cases and late in others; minutes show Fed officials grappling with uncertainty amid slowing job growth and UK referendum fallout