Capital flows
Blanchard and Acalin warn of FDI measurement problems
Measured foreign direct investment is not as long term as generally thought, often reflecting transient capital flows and responding to US monetary policy, economists find
Frontier markets need framework to strengthen capital flow resilience – IMF paper
Frontier markets are affected by capital flows in similar ways to emerging markets, the paper argues, suggesting a change in the “landscape” of capital flows could have policy implications
Icelandic paper finds ‘striking’ ties between financial cycle and real economy
Authors identify strong financial cycle linked to global factors, which impacts macro variables including consumption and government spending; paper suggests range of policy responses
‘Still some flaws’ in transmission mechanism – Icelandic report
Monetary policy report says capital flow measures have not yet had as much of an impact as intended, with the yield curve stubbornly staying flat
IMF’s Lipton stresses importance of multilateralism
IMF first managing director calls for co-operation between emerging markets and advanced economies to help foster growth in the wake of Brexit
LatAm policy-makers were possibly ‘excessively optimistic’ over economic potential, BIS paper says
Downplaying commodity super-cycle may have led to incorrect assessment of economic potential in Latin America, paper says; may have skewed monetary and fiscal policies
Lipton: co-ordinated approach to capital flows ought to be considered
IMF first deputy managing director says it is time for ‘new generation of reforms’; capital flow reversibility has costs as well as benefits
Capital flow measures needed before offshore krona auction, says Guðmundsson
If the currency auction goes to plan, inward flows could strengthen and the Central Bank of Iceland needs the tools to resist them, its governor says
BoE’s Forbes outlines new thinking on current account imbalances
Breaking current account into trade and financial components allows more detailed analysis of when a large imbalance is dangerous and what shocks could cause trouble
Fed QE drives portfolio rebalancing towards foreign assets, Brazil paper finds
Research analyses ‘comprehensive’ dataset for Brazilian capital flows and a smaller one for other EM economies
IMF will ‘take stock’ of capital flow policies
IMF may undertake further work on capital flow management and foreign exchange interventions if analysis highlights need for it; fund will also re-examine global safety net
Banks start to clean up balance sheets after RBI asset quality review
Efforts will enable flow of credit in the long term, deputy says; improving capital buffers and governance structures also beneficial
Bank of Israel’s outgoing chief, Stanley Fischer, on the challenges of central banking
Stanley Fischer believes his work as governor of the Bank of Israel is done. He tells Chris Jeffery about the reform process in Israel as well as the challenges facing the world economy and the IMF