Central Banking
UK abandons plan to end cheque use
Method of payment will exist for “as long as customers” need, says Payments Council
Iceland paper reviews monetary policy in turbulent times
Central Bank of Iceland study shows banks’ price setting behaviour and inflation expectations have been negatively impacted by banking crisis
Upheaval at Bank of Israel
New directors of the research and market operations departments; long-serving director of human resources and administration department resigns
China insists local government debt is ‘manageable’
People’s Bank of China dismisses claims local government financing vehicles owe 14 trillion yuan; says risks from the debts are manageable
King receives 2.5% pay rise
Bank of England 2010 Annual Report shows governor Mervyn King’s starting minimum salary for 2010 increased to £375,000; deputy governors also receive pay rise
Basel and Dodd-Frank create arbitrage potential, say analysts
Removal of credit ratings under Dodd-Frank will create arbitrage opportunities – and is already being exploited by some US banks, research claims
Weber gains clearance to join UBS
Eurozone and German central bank give former Bundesbank president Axel Weber green light to join UBS in May
BoE identifies deficiencies in central banks’ monetary policy frameworks
Bank of England deputy governor Charlie Bean says central banks must review their monetary policy frameworks to include a more prominent role for financial intermediaries
BIS’s Caruana urges completion of regulatory reform agenda
Bank for International Settlements general manager Jaime Caruana highlights a number of challenges facing national authorities in implementing critical reforms
IMF paper on leaning against the wind in Latin America
Fund study says countercyclical instruments are an effective tool to restrain excessive credit growth in Latin American countries
European debt concerns spark bond market sell off
European bond markets tumble amid growing concerns over Italy’s ability to tackle its fiscal deficit; uncertainty over Greek rollover adds to market uncertainty
Sudan relinquishes control of financial system in the South
Measures to relinquish control of southern financial system following independence declaration of South State
US will resolve debt crisis by August 2: Obama
President Barack Obama says failure to raise the US debt ceiling would be “not acceptable”
BIS report highlights steps to curb sovereign debt risks
Basel working group outlines measures central banks can introduce to mitigate the risks associated with sovereign debt
LOLR creates incentive for banks to over-leverage: Netherlands Bank paper
A Netherlands Bank study finds central banks’ lender-of-last-resort function motivates banks to take on excessive risk
Israeli housing bubble in early stages: Bank of Israel paper
Bank of Israel study shows house price increases in Israel are not exceptionally high relative to past episodes
Former Vietnamese governor suspended over corruption scandal
After reports implicate Le Duc Thuy, a former governor of the State Bank, the country’s prime minister forces him out of public service
Expansionary effects of fiscal contractions overstated: IMF paper
Fund study finds bias in literature towards expansionary effects on fiscal contractions
Euro area needs better coordinated political union: ECB’s Bini Smaghi
European Central Bank executive board member Lorenzo Bini Smaghi calls for more active participation by euro area governments in political union
BoE’s Haldane highlights increasing risks from high-frequency trading
Bank of England executive director of financial stability Andrew Haldane outlines policy measures to reduce systemic threat posed by high-frequency trading
New lending rules for Chinese SMEs overlook deeper structural issues in credit market, say analysts
China Banking Regulatory Commission introduces new measures to boost lending to small businesses; analysts say real problems lie in regulatory framework that favours the state sector
Fed's Hoenig warns of risks from late rate rise
Kansas City Federal Reserve president Thomas Hoenig urges Federal Open Market Committee to begin moving out of very accommodative monetary stance
T2S framework agreement delayed due to four remaining issues
There are four remaining issues that are delaying the forthcoming Target-2 Securities (T2S) framework agreement, according to an industry leader from the European Central Bank (ECB).
Regulators may not have authority to delay Dodd-Frank, warn lawyers
Some lawyers claim the CFTC and SEC may not have power to delay enforcement of the Dodd-Frank Act – a grey area that could lead to disputes