Research
Minimum haircuts must be carefully designed – BIS bulletin
Funding- and collateral-driven trades incentivise different repo terms, authors point out
BIS paper proposes simpler Basel capital framework
Authors say ‘capital stack’ is too complex and does not provide enough resilience to some shocks
Private liquidity insurance improves stability – BIS study
Yet prospect of central bank interventions can crowd out market, authors say
BIS paper explores how central bankers’ lives shape policy
Officials who have experienced high inflation tend to be more hawkish, researcher finds
€25K handouts would not affect labour market – ECB paper
Stimulus packages are effective in raising consumption, researchers argue
BoE paper highlights ‘cost-of-carry’ channel of monetary policy
High inventory levels can boost transmission, authors say
CBDC technical design has little impact on demand – BoK study
Working paper also finds that interest-bearing retail instruments attract more interest
Advanced economies’ debts are ‘unsustainable’ – research
US, Japan and European nations need to get their fiscal act together, says study by Belgian central bank
CBDC or fast payments can break up ‘walled gardens’ – BIS paper
Study of ‘competing digital monies’ finds public system could prevent fragmentation and rent-seeking
Poorer areas in US have higher food inflation – research
Low-income areas also have less disinflation after shocks pass, Atlanta Fed study finds
Support for euro hits ‘record highs’ – ECB
Previously sceptical countries have grown to like shared currency, research suggests
Climate risks still underplayed in credit ratings – ECB blog
Sovereign bonds, utilities and automotive and insurance sector securities most impacted by climate
Tariffs not increasing activity or jobs in US manufacturing – study
Labour supply constraints and increased input costs are holding sector back, say Fed researchers
BoE paper explores redistribution from macro-pru tools
Evidence suggests there are stability benefits but also costs from using borrower-based tools
Central banks speak opaquely to avoid overreaction – ECB study
Authors say institutions tend to communicate more clearly when they know their reputations are low
AI models ‘know more than they say’ – BoE paper
Tapping into ‘hidden states’ of large language models can improve data processing, authors claim
Emerging market central banks should be hawkish – NBER paper
Stronger reactions to inflation surges help to build institutions’ reputations, researchers argue
Firms slow to adjust investment targets for inflation – BoJ study
Discount rates are sticky and do not rise with expected increases in price levels, research finds
Researchers revisit 20-year forecast for global monetary system
Eichengreen and Razo-Garcia predict further move towards polarised exchange rate regimes
Stablecoins to trigger rise in demand for Treasuries – study
Authors say sector’s growth could take demand from around $300bn today to $2trn by 2030
Swiss price controls do not depress inflation – SNB paper
CPI metric would ‘not have greatly differed’ had it excluded price-controlled goods, study finds