Capital
Expected loss model can cut capital procyclicality – BoE paper
New approach to loan loss provisioning can improve stability of capital and leverage ratios
Capital buffers not all working as intended – BoE paper
Some banks raised rates and contracted credit supply during the Covid-19 crisis
Nepal central bank prohibits overseas investments
Move follows import restrictions in 2022
Rethinking the CCyB
As central banks rush to replenish bank capital reserves, the countercyclical buffer may need some fine-tuning
The rise of non-SDR currency reserves
New Cofer data release may show an overall fall in FX reserves, writes Gary Smith
Capturing moral hazard: the Scarlet Pimpernel of finance
Moral hazard exists in many contexts, but can be ‘damned elusive’ to capture, writes Jesper Berg
The canary in the goldmine
Gold accumulation may herald broader concerns about dollar holdings, writes Jennifer Johnson-Calari
Proportionality in bank regulation: striking the right balance
Careful analysis is required when making any proportionality adjustments in the EU single rule book
Book notes: A monetary and fiscal history of the United States, 1961–2021, by Alan Blinder
An infusion of the history of fiscal policy into a theoretical framework traditionally focused on monetary instruments
Fed’s climate risk guidance splits governors
Consultation on climate risk principles criticised by two Fed governors
Gilts debacle exposes financial stability risks
Lurking leverage in liability-driven UK pension investments raises important questions for central bankers
Armenia’s Galstyan calls for a new framework to tackle uncertainty and nonlinearities
Favours risk-management approach to policy and less emphasis on baseline forecasts that give false assurances
Bank of England pushes ahead with ‘Basel 3.1’
Central bank says amendments to Basel III could halt downward drift in risk-weighted capital ratios
Chile’s Costa on tackling inflation, forex interventions and nowcasting
Chilean governor discusses stubbornly high prices, Fed spillovers, reserve buffers, retail CBDC and unconscious bias
Book notes: Zero interest rate policy and the new abnormal, by Michael Beenstock
Thesis that QE caused low r* is entertaining and infuriating in equal measure
FSB calculates G-Sib list with revised methodology
Some global banks change “bucket” under first use of Basel Committee’s revised method
Book notes: Yellen, by Jon Hilsenrath
Offers new insights into the tough decisions Yellen has made as a pre-eminent economic policy-maker
Liquidity dependence may hamper QE exit
Expanding reserves may prove perilous for financial stability, with maximum danger during QT, writes Viral Acharya
BdF to achieve 1.5°C climate goals by 2026, governor says
De Galhau calls for mandatory climate disclosure, green capital requirements and collective ecological governance
Christopher Sims on modelling the inflation surge
Unprecedented shocks creates major challenges for forecasters, the Nobel prize-winning economist says
African governors face multiple financial ‘floods’
Kenyan governor says a “doubling, tripling” of access to IMF resources is needed
Bernanke, Diamond and Dybvig win Nobel Prize
Economics prize goes to authors of widely cited work on financial crises
ECB paper looks at Covid-19 emergency supervisory measures
Relaxation of CET1 requirements positively affected lending, but change to Pillar 2 guidance did not