Research
DNB publishes hacking guide for cyber security exercises
“Red teams” must simulate attacks on critical functions, guide says
Central banks should not give impression of ‘complete foresight’
Bank of Canada officials say the goal is to convey “comprehensive assessment” of factors affecting policy while acknowledging uncertainty
ECB criticises banks’ Brexit plans
Central bank stresses institutions need to have meaningful operations in the eurozone
Central banks should combine monetary rules to achieve objectives – research
Estimates based on different models should be updated regularly, authors say
Austrian paper takes detailed look at regulatory integration within EU
Researcher uses “bilateral nature” of EU reforms to help gauge effects
BIS paper studies how weak banks beget zombie firms
Weak banks have a tendency to misallocate capital, authors find, though the effect is only important in the long run, in contrast to earlier studies
Riksbank’s executive board divided over QE programme
Some members advocate ending stimulus in December, others fear that could reduce inflation
NY Fed paper estimates US contagion risks
Authors design a network model incorporating non-banks to estimate how the risk of a “default cascade” has changed over time
Eurosystem is less transparent and efficient than Fed, research finds
European central banking structure is twice as expensive as its US equivalent
Bank of Spain warns Catalan crisis may cut growth by 60%
Uncertainty could imperil Spain’s recovery and reduce growth by 2.5% of GDP until late 2019
OTC derivatives fall to lowest levels since financial crisis, BIS says
The gross market value of outstanding OTC derivatives contracts falls to below $13 trillion at mid-2017
European firms’ net debt cramped investment, Bank of Italy paper finds
Paper looks at eurozone and UK firms from 2006 to 2012
BIS paper surveys financial shocks in Latin America
Authors study the most effective policy response to financial shocks in different countries
Irish economy significantly affected by shocks from UK, researchers say
Falls in UK growth and depreciation of pound have “sizeable” impact on Ireland, paper says
Scottish central bank could be based around ‘stakeholder’ framework
Think-tank proposes framework for Scottish central bank, should independence vote occur, based around a “stakeholder” structure
Anti-gambling nudges can improve household finances – Philly Fed research
Natural experiment shows how removing “geographically close cues” can help tackle addiction
Market structure affects monetary neutrality – paper
Minneapolis Fed research finds oligopoly undermines the neutrality of money, amplifying the real impact of monetary shocks
Internal capital reallocation matters, BIS paper finds
Authors model response of a bank to tightening capital constraints, shedding light on how banks may respond to changes in their environment
Paper examines EM response to global liquidity shocks
Emerging markets reduce rates and increase reserves in the face of positive liquidity shocks
BoE paper scrutinises 2016 sterling flash crash
Paper makes detailed study of the “flash episode”, concluding later price drops were abnormal
ECB QE lowers yields via portfolio reshuffling – research
Sovereign bond-buying programme sharply reduced 10-year Bund yields
Norges Bank says it is still capable of managing wealth fund
Central Bank Law Commission recommends creating a new entity to manage the Government Pension Fund Global
Text mining reveals differences in PRA approach
Researchers compare Prudential Regulation Authority’s communications to its predecessor using a machine-learning algorithm
Zimbabwe back in hyperinflation, say Hanke and Bostrom
The economists estimate that Zimbabwe’s monthly inflation rate is now above 100%