Central Banking
BoE’s Saunders expects higher post-Brexit growth than central forecast
Bank of England’s newest committee member says the labour market is likely to prove more sluggish than the consensus suggests, but growth will be more positive
Esma says regulators should wait before imposing quantitative SFT haircut triggers
Decision on policy change should wait until 2018, authority says; chairman says “sheer size” of market makes transparency important
Low growth and low rates to hit financial stability, says IMF
Weak outlook is likely to feed into medium-term problems for financial stability, fund warns; Basel Committee may have to delay agreement on final framework
Fall in inflation only ‘temporary’ – Sarb governor
Positive factors underlying inflation decrease may not be here to stay, says Kganyago, emphasising a continued rise in inflation could threaten long-run growth
Fed task forces begin review of faster payments proposals
Payments firms have submitted plans for real-time payment systems and toughened payments security; merits of plans to be assessed over coming year
Mersch says eurozone deposit rates are only ‘mildly’ negative
ECB board member says rates can be “mildly” but not “wildly” negative before costs outweigh benefits; calls for faster progress on banking union
Nabiullina promises ‘profound’ structural change for Russian banking supervision
Current structure “insufficient” to solve Russia’s problems, governor says; first deputy governor Tulin to oversee regulation and supervision
Hike now to avoid more action later, says Fed’s Lacker
Richmond Fed president adds his voice to growing number of Fed officials calling for rate hike; Loretta Mester insists proximity to US election need not prevent action at next meeting
Central Bank of Solomon Islands commits to promoting private sector credit growth
Levels of liquidity “more than adequate”, latest monetary policy review says; central bank to maintain levels of liquidity by continuing to issue bills
Danish economist updates DSGE model with financial frictions
Jesper Pedersen adds imperfectly competitive banking system and housing market to improve model’s ability to explain crises
Banks leaving London for Dublin must be ‘run from here’ - senior Irish official
Central bank planning to recruit more regulators if necessary, Cross tells financiers; hints at possible need to boost salary packages for some staff
IMF: Central Bank of Iran should ‘streamline’ committee membership
IMF assessment warns of committees “dominated” by government agencies; fund stresses the central bank should limit membership to its senior officials and independent experts
RBI’s new MPC cuts rate at first meeting
Debate was “frank, often intense, but always friendly” says governor Urjit Patel, after monetary policy committee votes unanimously for a cut
ECB paper aims to improve small-scale models for assessing policy shocks
Paper outlines a structural factor model, which the authors say better accounts for the asset price impact of monetary policy shocks
EBA dashboard shows capital on the rise but NPLs remain a worry
Regulators’ quarterly risk assessment shows EU banks’ capital ratios have ‘slightly increased’, but loan portfolios remain an issue
US spillovers stronger for some countries than others – IMF paper
Paper assesses how US normalisation will spill across borders, identifying conditions where countries are most likely to be affected
Maskin: technocrats should set eurozone fiscal policy
Harvard economist argues a technocratic body similar to a central bank could set spending and revenue targets in eurozone before allowing politicians to determine the details
IMF financing ‘constrained’ policy space in Ukraine, report finds
Earlier debt financing would have been useful for Ukraine, report says, while praising central bank efforts to stabilise the financial system
BoE paper examines how US banks lend after hurricane shock
Local banks may play an “important role” in a geographically integrated banking system, paper says, despite their greater vulnerability to financial constraints
Independence, liquidity and a level playing field – yet another impossible trinity?
Jesper Berg warns it will likely be impossible to balance the demands of monetary policy independence, liquidity standards and achieving fairness for all banks
BIS research tests leverage ratio with adjusted DSGE model
Authors design a model with both leverage ratio and variable risk-weighted capital requirements, finding a range of benefits to constraining leverage
RBI’s Mundra: pinning down credit-GDP link is tricky
Deputy governor says a host of factors combine to make the link between credit and growth unclear, but the link may reinstate itself as the economy stabilises
DRC central bank more than triples rate amid reserves squeeze
Congo central bank raises headline rate five percentage points as foreign reserves continue to dwindle; economy is suffering from copper slump and difficult external environment
Inflation worries prompt action from Bank of Mexico
Central bank hikes interest rate by 50bps in last monetary policy meeting before the US presidential election; peso proves volatile in face of international events