Central Banking
Mass walkout at RBI disrupts clearing and settlement
The majority of the RBI’s 17,000 staff took ‘mass casual leave’ today, interrupting some RBI operations, though normalcy was ‘largely’ restored after negotiations
Sarb raises rate 25bp now to avoid bigger move later
Increasing risk of inflation spurs the South African Reserve Bank to raise its key rate by 25 basis points to 6.25%; two out of six MPC members preferred not to move
Dallas Fed’s Kaplan expects policy to ‘remain accommodative for some time’
Federal Reserve Bank of Dallas president says FOMC was ‘prudent’ to wait for more data in past few months; it is ‘probable’ rates will be lifted gradually
ECB’s Mersch explores construction of instant payments services
Yves Mersch says Eurosystem envisages services being constructed on scheme, clearing, and settlement layers, and considers challenges involved in each
Presentation of big data key to inspiring research, academic argues
New York University professor says financial regulators need to learn from large-scale scientific projects and online retailers to encourage ‘research communities’
Central bank 'silo culture' detracts from statistics, says ex-BoJ governor
Masaaki Shirakawa tells audience at Deutsche Bundesbank to expose economists to statistics and business contacts during their careers; Otmar Issing stresses value of good data
Banks face higher capital requirement under Basel trading book review
Basel Committee impact study on the fundamental review of the trading book implies minimum capital allocated to market risk will rise substantially for some banks
Cleveland Fed’s Mester lays out ‘considerable progress’ on payment systems initiative
Loretta Mester tells New York conference of progress in appointing leaders and accumulating members for faster payments and secure payments task forces
Mexico should ‘phase out’ daily FX sales, IMF staff say
Staff at IMF find interventions have ‘contributed to stability’ in the foreign exchange market, while a report following Article IV consultations recommends moving away from daily auctions
CLS starts settling Hungarian forint payments
After two years of preparation and testing, the forint joins the CLS universe
Bank of Israel approves first issue of loss-absorbing bonds
Bank Mizrahi-Tefahot allowed to issue contingent convertible bonds that will count as part of regulatory capital, with other banks expected to follow suit
Risk of banking crisis increases with ‘network centrality’, ECB paper argues
Modelling the interconnectedness of 14 European countries' banking sectors gives valuable information on the likelihood of a crisis, a paper published by the ECB argues
RBA’s Debelle outlines potential benchmark rate reform
Australian consultation paper suggests modifications to the calculation of the bank bill swap rate, with one option expanding the set of transactions covered
Honohan sets out virtues of new crisis tools in final speech
Irish governor stresses potential of direct recapitalisation and GDP-linked loans to help bolster debt sustainability in crisis-hit countries; expects successor Lane to come in with ‘big broom’
RBA’s Kent sees positive side to Chinese readjustment
China’s economic rebalancing is likely to bring benefits to Australia’s economy as well as costs, Reserve Bank of Australia assistant governor says
Market and survey-based measures of expectations provide useful information, ECB paper says
Survey-based and market-based measures of inflation expectations provide useful information on future eurozone price increases, a European Central Bank paper argues
Banks should improve tech infrastructure to aid stress testing, PRA officials say
Mark Yallop highlights demands on banks when assembling data, noting the 'generally poor state' of some technology infrastructures; Andrew Bailey says improvements would benefit all
Changing funding patterns cut both ways for emerging markets, central bankers say
Emerging markets are moving towards greater use of capital market funding, but while this could bring benefits for monetary policy, it also throws up a host of stability risks
Cyprus must make NPLs ‘number one priority’, international agencies say
Authorities must properly implement proposed loan reforms, joint statement says
Bank of Israel smoothes way for new credit card players
Central bank moves to ease the process of entering the merchant acquiring and credit card market; aims to streamline licensing and expand ownership options
Turkish paper finds Fed staff forecasts superior to rivals
Working paper finds forecasts in the ‘Greenbook’ were consistently more accurate than their commercial equivalents between 1974 and 2009
IMF urges response to rapid credit growth in Cambodia
Staff report lays out buffet of macro-prudential tools to address factors driving the expansion, which has seen the credit-to-GDP ratio double since 2012
Statistical spin may decide severity of trading book rules
Capital increase levied by Basel Committee on Banking Supervision could depend on use of mean versus median figures
Canadian paper sees costs to leaning against the wind
Research estimates difference in policy rates between ‘lean’ and ‘clean’ central banks, while identifying costs in terms of inflation and output deviations