Research
Obstfeld and Taylor back dual trilemma global finance theory
Economists still need to better incorporate financial stability into their thinking, the authors argue, with the concept of a financial trilemma helping to explain recent instability
Surprise policy announcements impact cash demand and consumption - paper
Unanticipated policy announcements can significantly reduce a consumer's monthly ATM withdrawals
Culture has ‘significant’ effect on Swiss saving – paper
Researcher uses data from linguistically different Swiss groups
‘Home bias’ in expectations heightens shocks – paper
Researchers present a model where domestic variables shape expectations
Chinese monetary policy now more in line with G3 central banks – BIS paper
“Liberalisation and transformation” of the Chinese economy has led to changes in the PBoC’s monetary policy rule, and an improvement in inflation performance, authors say
Irish paper examines why banks set collateral conditions
Ex-ante risk and loan size are key factors, researchers say
Riksbank paper studies impact of oil on world business cycle
Researchers find possible solution to macro puzzles by introducing oil shocks into a model of the global economy
Balance sheet weakness and falling investment to blame for productivity slowdown – paper
IMF paper rejects structural hypothesis for slowdown in productivity growth following crisis; firms with balance sheet issues and those hit harder by credit tightening cut back on investment
Policy rate forecasts influence expectations – Riksbank paper
New data allows researcher to assess the “potency” of rate forecasts, which do appear to influence expectations
Paper examines how sovereign debt losses hit real economy
Researcher presents unique database on eurozone sovereign debt crisis
Riksbank paper finds ‘significant’ gains from faster trading
Faster trading systems have eliminated arbitrage opportunities, improving market efficiency and quality, authors say
ECB paper classifies eurozone banks’ business models
Researchers use supervisory data to outline models’ risk and performance
Irish paper tracks monetary policy’s effects on mortgage default
Researchers use “quasi-natural experiment” based on data from two types of loan
Poorly designed macro-pru leads to ‘leakages’, says Turkish working paper
Macro-pru should be designed so firms cannot “bypass” regulations implemented during positive global liquidity shocks; generally policies are effective in controlling credit
Belgian paper examines use of illiquid loans as collateral
Liquidity and funding purposes both inform banks’ decisions, researchers say
Risk weightings should reflect borrowing constraints, paper argues
Finnish paper criticises principle behind regulations on capital requirements
Authors struggle to cut ‘price puzzle’ from Australian data
Authors find various approaches to removing the puzzle from VAR models fail for Australian data, calling into question the usefulness of the models
Banking flows affected by ‘Anna Karenina principle’ – paper
All healthy credit relationships are alike, but each unhealthy credit relationship is unhealthy in its own way, the study explains
Riksbank researchers flag benefits of major capital boost
Significant increase in the leverage ratio for Swedish banks could bring net social benefits, study finds
Paper examines effects of concentration of exports
Bank of Spain researchers examine 12 eurozone countries
Credit cycle matters for fiscal policy – BIS paper
Phase in financial cycle has “substantial” impact on public finances, authors find; commodities cycle less important but matters for some
IMF paper sheds light on solvency and liquidity interactions
Neglecting the “solvency-liquidity nexus” could lead to mistakes in stress-testing models, authors warn
French paper looks at impact of budget-neutral fiscal changes
Benefits and costs of budget-neutral changes “not equally distributed across agents”
LTV ratio more effective than DTS in Canada – BIS paper
Paper examines the effect of recent macro-prudential policies targeting the housing market, finding households will borrow more if they can