United States
Progress on resolution frameworks has slowed, FSB warns
Few jurisdictions have all the rules in place and legislative progress is slowing, Financial Stability Board says in its latest peer review of resolution regimes
Fed officials lower expectations of rate increases
Fed officials forecast rate increase of 50bp this year, compared with 100bp in December; Yellen “wary” of recent increase in headline inflation
Brainard warns of segmentation of liquidity
Recent changes in liquidity practices may heighten financial markets’ vulnerability in stressed conditions, Brainard says; downward pressures on inflation remain, she adds
NY Fed says ‘no evidence’ systems breached
Spokeswoman says there is “no evidence” of attempts to penetrate Federal Reserve systems, amid reports saying Bangladesh Bank was concerned funds were stolen from its account
US monetary policy contraction means drop in global output – paper
Raising interest rates in the US leads to lower global output and inflation in the short term; most 'pronounced' responses evident in the mid-1990s to mid-2000s
Economists mull how to improve Fed communications
Paper presented at US Monetary Policy Forum encourages Fed to move away from ‘time-based’ forward guidance; considers what kind of new information would be useful to markets
Research calls for better understanding of ML/TF risks in Islamic finance
Working paper published by International Monetary Fund warns there is ‘no common understanding’; some risks may be the same as in conventional finance, but some may not
IMF to publish informal briefings on Argentina
Staff compile informal briefings on countries when they fail to complete Article IV consultations; IMF will grant request from Argentina to publish those produced 2013-2015
Hong Kong activity should weather higher rates – paper
Research published by IMF argues consumption and investment will “remain robust”, despite increase in interest rates in tandem with the US
NY Fed’s Potter ‘extremely pleased’ with rate control
The Fed’s framework for controlling money market rates has proven ‘effective’ in the wake of December’s lift-off, according to executive vice-president Simon Potter
Senate committee chair urged to clear backlog of nominees
Nominees to Federal Reserve board of governors among those waiting to learn fate; delay reportedly stems from disagreement over another key Fed post
Ten Fed presidents handed new terms
All presidents and first-vice presidents at the 12 reserve banks now have terms that run to end of February, 2021; Powell insists there was a ‘rigorous process’
FOMC members agree uncertainty over US prospects has ‘greatly increased’
Global uncertainty and financial market volatility increases downside risk for US economy, FOMC members say; committee members express different views over use of fan charts in projections
People: Philadelphia Fed names first VP; five new vice presidents at AIIB
James Narron named vice-president and COO of Philadelphia Fed; five new vice-presidents join executive team at AIIB; and more
Fed’s Harker adopts more cautious tone on policy
Philadelphia Fed president says it may be more 'prudent’ to wait for stronger inflation data before hiking for a second time; sees inflation rising more gradually than before
Bullard challenges ‘backward-looking’ language in Fed statement on goals
James Bullard reveals he disagreed with an element of the Fed’s statement on longer-run goals, believing it failed to capture the importance of future expectations to inflation targeting
Fed’s Kashkari: more needs to be done to end too-big-to-fail
Minneapolis Fed president says 'transformational' approaches, such as breaking up the largest banks, should be given “serious consideration” in quest to end too-big-to-fail
Dudley says US households responding more cautiously to house price growth
New York Fed report finds housing debt has been relatively flat over past few years despite house prices rising steeply over the period; points to higher principal debt repayments
Fischer raises concern over ‘stigma’ around Fed loans
Fed vice-chair Stanley Fischer warns new reporting requirements in the Dodd-Frank Act will “likely add to the challenge of reducing stigma” associated with borrowing from discount window
Book notes: Phishing for phools, by George Akerlof and Robert Shiller
The veteran economists’ study of the traps markets create for unwitting consumers ultimately ends up doing exactly what the authors caution against
Lagarde only candidate for IMF top job
Executive board says Lagarde the only person put forward during nomination period, which closed yesterday; selection process to be completed ‘as soon as possible’
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’
Research considers why macroeconomic announcements impact asset prices
A working paper published by the ECB weighs the ‘intrinsic value’ of macroeconomic news announcements in the US, finding timing is crucial to maintaining it
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