Central Banking
PSPP’s effects became significant after expansion – Irish paper
Paper examines responses of Ireland-domiciled investment funds
Recovery increasingly resilient; inflation predictions down – ECB
GDP forecasts revised up and ECB says recovery is “broadening”, but inflation projections revised down
UK payments regulator unveils competition reforms
Reforms aim to open up UK payments infrastructure to competition, and include move to common messaging standards
Asset purchase programme is key to central bank credibility – ECB paper
Researchers analyse market reactions to unconventional monetary policy decisions
BIS paper links debt service lag to impact on real economy
Authors find the lag between borrowing and peak debt service helps explain why debt booms reduce future output and increase the probability of a crisis
OCC warns on cyber risks from subpar patches at US banks
Regulator says banks have good track record overall, but exams reveal weaknesses
Riksbank claims rate forecast success, despite inaccuracies
Study of 10 years of repo rate forecasting concludes it is a useful tool for setting and communicating policy, although forecasts “have not been particularly accurate”
IMF urges ‘no favour, no obstacle’ approach to Islamic banking
Report urges countries to adopt more consistent prudential standards for Islamic banks and strengthen liquidity management frameworks
Commission should have power to order CCPs to relocate to EU – Cœuré
The power would be one among many, says ECB executive board member
BoE’s Haldane examines changing nature of work
Rise of “gig economy” and self-employment may have weakened wage-setting power among workers, the BoE chief economist says; he indicates a willingness to vote for a hike later this year
Regulatory tightening has caused decline of money growth, PBoC official says
PBoC official says regulatory policy and monetary policy go hand in hand; recent flurry of regulatory activity is impacting monetary policy
Indonesian banks will switch to reserves averaging in July
Latest move in Bank Indonesia’s major overhaul of monetary policy transmission and efforts to deepen financial markets
Europe must learn right lessons from crisis – Olli Rehn
Moral hazard should not dominate policymaking, Finnish board member says
South African governor rejects calls to change mandate
Public protector calls for the central bank to drop the defence of the value of the rand
Chicago Fed’s Evans: central bankers may be biased against inflation
Chicago Fed president thinks current policymakers may have overcompensated for inflationary bias of the past
Little evidence to support ‘global slack’ thesis, ECB paper argues
Researchers say global spare capacity is not increasing as an influence on eurozone inflation
RBA minutes point to dangers from debt
Growth in household debt exceeds growth in incomes, creating risks to consumption; board members say situation warrants “careful monitoring”
BoE economists criticise DSGE inflation modelling
Team including MPC member Kristin Forbes criticises structural modelling approaches for failing to properly account for trend inflation
BIS comes to the defence of globalisation
Increasing trade and financial integration have had a “profoundly positive” impact on people’s lives, but do bring drawbacks too; the correct response is not a wholesale rollback, says Jaime Caruana
Some outflows from China may have been ‘disguised’ – Fed paper
China’s success reducing current account surplus may partly have been due to financial outflows disguised as “travel”, Fed economist finds
Thai central bank warns on deteriorating debt serviceability
Bank of Thailand flags financial stability risks as weakening macroeconomic outlook impacts debts among SMEs and households
Model looks at outbreak of ‘fire sales’
Higher capital ratios may aggravate financial contagion, the authors say
EBA calls for tighter money-laundering curbs on crowdfunding
EC should make consumer protection a “key” part of its fintech approach, the EBA says
No ‘Taylor rule’ without Meltzer’s support
John Taylor says he would “likely have done other things” if not encouraged by Allan Meltzer to develop the eponymous rule