Central Banking
IMF’s Lagarde warns on global growth
Managing director says next week’s assessment of world economy will bring bad news with regard to growth; urges increased co-operation to renew economic recovery
‘Unofficial dollarisation’ raises significant stability risks, ECB study finds
Emerging markets with large holdings of ‘hard’ currency assets and liabilities are exposed to substantial stability risks and policy failure, finds ECB study
Brazil and South Korea cut rates amid economic gloom
Central Bank of Brazil and Bank of Korea cut interest rates due to poor economic outlook and declines in indicators; Brazil marks eighth consecutive reduction while Korea makes first cut since 2009
SNB paper links low interest rates and housing bubbles
Swiss National Bank working paper finds strong relationship between low short-term rates and housing bubbles; argues house prices can be controlled by following ‘Taylor rule’
National Bank of Serbia annual report reviews policy changes
Annual monetary policy report highlights shift in mid-2011 towards monetary easing in Serbia; says pressure from food prices caused inflation to repeatedly overshoot target in first half of year
Bank of Finland paper evaluates confidence indicators in forecasts
Discussion paper analyses the link between measures of confidence and growth forecasting in the Russian economy; finds not all measures improve accuracy of forecasts
ECB paper studies sovereign debt and growth links
Working paper studies relationship between different levels of sovereign debt and growth; finds increasing debt only boosts short-run growth up to a certain threshold
IMF paper studies effects of macro-prudential policy
Working paper studies effectiveness of macro-prudential policy in an environment of financial innovation; identifies various factors determining policy outcomes
EBA says banks did not sell assets or cut lending due to 9% capital rule
EBA claims banks have not substantially cut risk-weighted assets or lending to meet new minimum core Tier 1 ratio; actions were part of a series of measures agreed by the European Council in October
Asian central banks press ahead with OTC derivatives reform
Reserve Bank of India launches OTC derivatives trade repository; HKMA reveals results of consultation on derivatives regulation
Central Bank of Ireland slams ‘poor’ investment firm practices
Inspections by Central Bank of Ireland identify inadequate best execution practices by investment and stockbroking companies; requires remedial action by August 31
CFTC-SEC swap ruling starts Dodd-Frank compliance race
Publication of swap rule will mark start of 60-day countdown to compliance with registration and reporting rules. Industry will find it 'quite challenging' warns CFTC's O'Malia
Bank of Lithuania takes next step in structural overhaul
New banking service aims to promote efficient investment operations and mitigate risk; comprises third step in central bank’s restructuring programme
RBA deputy governor warns of regulatory side-effects
Reserve Bank of Australia’s Philip Lowe reviews impact of new financial regulation; says although new rules likely to increase stability, regulators must be aware of possible negative consequences
SNB paper evaluates central bank communication strategies
Swiss National Bank working paper examines two communication strategies designed to reduce market overreaction to announcements
BoE’s Jenkins examines severity of Basel regulations
Bank of England Financial Policy Committee member, Robert Jenkins, says Basel III requirements are not too tough on banks; argues higher capital levels do not harm the economy or bank shareholders
Russia takes lead in gold purchases in May
Latest World Gold Council figures show Bank of Russia increased gold reserves by largest amount in May; council says emerging markets purchases viewed as a part of ‘broader theme’
Spain’s Frob shakes up management ahead of bailouts
Fund for Orderly Bank Restructuring (Frob) selects new general manager from Spanish government among other senior appointments; first €30 billion of bailout funds to be handled by the Frob
Former governor of Croatian National Bank delivers fiery exit speech
Željko Rohatinski says he is ‘proud’ to pay the price for standing firm on tough decisions by losing his position as governor; criticises lack of ‘moral virtue’ in political circles
Eurogroup decides on three senior appointments
Decisions end speculation over leadership of the Eurogroup and the European Stability Mechanism; nomination also put forward for empty seat on ECB executive board
NBS paper measures impact of productivity differentials
National Bank of Serbia working paper studies effect of differing productivity growth between sectors and countries; finds impact on inflation and exchange rates
IMF paper studies reduced financial interconnectedness
Working paper examines impact of deleveraging by financial institutions through declines in collateral use; identifies issue that may cause unintended consequences
National Bank of Hungary paper surveys wage rigidities
Paper presents findings of large European survey conducted by central banks; finds wages are more rigid than prices, but various factors determine the frequency of adjustment
BoE paper quantifies output gap estimation errors
Bank of England discussion paper models accuracy of output gap estimations based on OECD data; argues that absolute size of revisions to estimates does not improve over time