Central Banking
‘Significant progress’ on infrastructure overhaul – RBNZ annual report
Past year saw progress on replacement RTGS system, decision on new securities clearing system and the start of a project to modernise Treasury functions
People: RBNZ appoints new board chair; reshuffle of senior management at Australian central bank
Reserve Bank of New Zealand replaces board of directors’ chair after 10 years at bank; assistant governors swap roles at the RBA as the bank looks to hire new talent; and more
EBA default standards could prove ‘burdensome’, banks warn
Implementation likely to be costly, especially for IRB-based firms, authority admits; standardisation necessary in view of wide range of current practices
Fiscal policies the answer to commodity decline in Africa – BIS paper
Counter-cyclical policies have done all that they can, paper says, adding it is now time for exchange rate and fiscal policies to bear the burden and spur growth
IMF: rise of non-banks is reshaping policy transmission
Pass-through of monetary policy grows as non-banks become more important, but changed transmission mechanism demands better data to understand risk-taking channel
PRA tightens standards for buy-to-let market
“Interest coverage ratio” and affordability stress tests to be implemented by January 2017, while remaining measures must be implemented by September 30
Bank of Canada should not raise inflation target – Obstfeld and co-authors
Central bank has been overtaken in transparency metrics, authors say; forward guidance would catapult Canada to top of rankings and could avoid the need for unconventional measures
Rajan and co-authors present paper to ECB research conference
Paper introduces “pledgeability” as analytical tool; concept helps explain prolonged financial downturns, authors say
Decentralised tech will not become the new normal – SNB’s Jordan
There is a time and a place for distributed ledgers, says chairman of Switzerland’s SNB, but right now they cannot compete with existing FMIs
Big data could cut regulatory costs, say panellists
Big data could lead to a reduction in costly regulatory reporting, but three experts say there is still a long way to go before the figures are up to scratch
Fischer: economics needs more diversity
Fed vice-chair says economics would benefit from more ethnic and gender diversity, outlining some ways in which the central bank is trying to move in that direction
Fed’s Yellen defends Brainard against congressman’s charges of political bias
No sign of political bias from FOMC members, Yellen says, amid accusations Lael Brainard might be looking for a job in a Hillary Clinton administration
Bahamas launches new banknote series with innovative security thread
Central Bank of Bahamas launches “Crisp Evolution” series, the first “circulation banknote” to feature new colour-changing security thread; $10 note to enter circulation immediately
Armenia cuts again as deflation deepens
Central bank cuts headline rate as inflation dips further below zero, though the board maintains it will be able to return inflation to target in medium term
Questions need to be answered before DL technology becomes viable payments option – BoE’s Hauser
Challenges in the payments landscape could be overcome by new technology such as the distributed ledger, says Hauser, but too many “big questions” remain around such a scheme, relegating it to the realm of research
Inflation expectations more sensitive near the zero lower bound – IMF study
IMF study examines whether monetary policy can boost inflation in constrained environment; countries near zero lower bound could see inflation respond more to shocks
Central banks adopt Swift harmonisation charter
Three central banks join 18 other institutions in global rollout of messaging standard ISO 20022; separate taskforce working on publishing market practice guidelines
Better swap lines could support global co-operation – BIS’s da Silva
Improving the global network of swaps, particularly between advanced and emerging economies, could create a more stable system, deputy general manager says
ECB publishes online newsletter on financial market infrastructure
Newsletter will be published three times a year, covering central bank’s work as operator and overseer of financial market infrastructure
Fed members differ on monetary policy, as Trump again attacks Yellen
Rosengren calls for “modest, gradual tightening”, while Kashkari sees slack in labour market; Republican candidate questions Fed’s political impartiality
BoE’s Salmon warns forex industry on adherence
Chris Salmon, the Bank of England's executive director for markets and lead on global code adherence, says regulation could be on the horizon as soon as 2020 if market participants don't adhere to the new Global Code
Fed’s Tarullo: stress testing needs to evolve
Fed is planning to toughen its stress-testing framework with better alignment with regulation and incorporation of dynamic “amplification” effects – though more research is needed
Factors behind weak growth in advanced economies do not apply to South Africa – Sarb deputy
Mminele says 2008 recession did not create savings glut in South Africa, suggesting other factors such as a shortage of skills are responsible
ECB says it has learned lessons from simulated cyber attack
Federal Reserve, eurozone central banks and private firms took part in exercise to test Target2 payment system