Research
Portuguese paper finds banks lend to riskier borrowers when policy rates are low
Researchers find evidence supporting the existence of the ‘risk-taking channel’ of monetary policy; banks will grant more loans to companies with recent defaults when rates are lower
RBA inflation target mitigated terms of trade macro shocks
Researchers at the Reserve Bank of Australia argue that the country’s inflation targeting framework helped to mitigate the macroeconomic consequences of the recent terms of trade boom
Household borrowing not caused by income inequality, Richmond Fed paper argues
Finds low-income households in high-inequality regions accumulated less debt relative to income than their counterparts in lower-inequality regions; rebuts 'wish to keep up' as driver of credit demand
Chinese labour costs set to play significant inflation role
Researchers suggest that increases in labour costs do not pass ‘fully’ through to prices in China; warn this could change on the back of ‘recent sizeable growth’ in nominal wages
Kohn says Fed's independence 'at risk'
Former Federal Reserve vice-chairman Donald Kohn argues the institution's autonomy has been undermined by recent policies; lists four explicit threats in paper published by the Brookings Institution
Paul Tucker laments 'faltering vigour' of international reform
Former BoE deputy governor argues there is 'less coherence, faltering vigour and conflicting views about how different national regimes should apply to inherently international markets'
Bank of Finland paper backs nominal GDP as policy target
Research finds that price level or nominal GDP targeting is ‘on the whole’ better than inflation targeting as long as private agents adapt their expectations accordingly
Dutch paper finds Germans ‘substantially more cash oriented’ than other nationalities
Researchers consider why cash is still ‘heavily used’ for low-value payments in Europe; attributes German consumers' continued use of cash to ‘precautionary’ reasons
Inclusion of 'spatial effects' help explain Colombian money market spreads, central bank paper argues
Traditional factors like 'size and leverage' insufficient to explain borrowing spreads, argues paper, which is 'first attempt' to model Colombian money market within a spatial econometrics framework
Emerging Asia must reform to keep growing, says IMF research
China and India have recently exhibited a decline in total factor production growth; demographic factors will be more supportive in India and some Asean economies than in China
Bundesbank paper finds benefits in concentrated bank lending
Researchers find that banks with more concentrated credit portfolios have lower expected write-offs and unexpected risk than their counterparts
Real exchange rates determined by 'cointegrated' factors, Bofit paper finds
Evidence suggests sectoral total factor productivity differentials, real interest rate differentials and real gold prices explain movements in bilateral US real exchange rates between 1970-2006
Bank of Albania paper trials CAB approach to estimate fiscal position
Bank of Albania economist applies cyclically-adjusted budget balance approach to estimate country's fiscal position, finding fiscal policy to be pro-cyclical
Commodity price inflation caused by 'financialisation', RBI paper finds
Research also shows private liquidity is inflationary while official liquidity is not and and that derivative traders, active and passive, have played an important role in inflation dynamics
Israeli paper finds ‘prolonged decline’ in Nairu
Researchers at the Bank of Israel utilise the Phillips and Beveridge curves to estimate the country’s non-accelerating inflation rate of unemployment between 1998 and 2012
Polish paper says monetary policy transmits mainly through real sector
Researchers at the National Bank of Poland build a structural vector-autoregression model that includes both fiscal and monetary policy
Fiscal policy can counteract Dutch disease, say Peru economists
If the gains from public investment are shared throughout an economy, then such government spending can counteract the harmful effects of Dutch disease
US community banks losing their edge with small businesses, paper finds
Fed discussion paper finds small, opaque businesses are just as likely to use a large banking corporation as they are a community bank; strong banking relationships remain important
Banque de France paper explains new GDP forecast model
New model aims to eliminate 'systematic upward predictive bias' since the crisis
IMF paper models sovereign restructuring in monetary union
Paper prepared by economists in IMF's fiscal affairs department shows the restructuring country's economy would suffer more if its residents hold most of its sovereign debt
Dutch paper finds that bonuses are main cause of distrust in banks
Researchers at Dutch central bank find that banker bonuses have a greater impact on public trust than government intervention, stock prices and media reports
Asian decoupling a figment of the great moderation, says BIS paper
Evidence of Asia's economic decoupling from the rest of the world was a symptom of low co-movement during tranquil economic times, which ended with the arrival of the financial crisis
Macro-prudential and fiscal co-ordination could pay big dividends, IMF staffers say
International co-ordination of macro-prudential and fiscal policies would have a far greater effect than the literature predicts for internationally co-ordinated monetary policy, paper shows
RBA bulletin considers CCP resolution
Reserve Bank of Australia quarterly bulletin features an article on the recovery tools and resolution regimes that could be employed when central counterparties suffer losses