CB In Depth
Material world: the enduring appeal of paper banknotes
Central banks have used space-age polymers to make banknotes for decades. So why does paper remain predominant in banknote production?
Book notes: The cost of free money, by Paola Subacchi
A book worth reading, as it facilitates further discussion on substantial issues, but doesn’t fully address some of the problems it takes aim at
Masaaki Shirakawa on lessons from crisis and how to reform central banks
The former governor reflects on a turbulent 40 years at the Bank of Japan, and considers how central banks might face up to the challenges of the future
Book notes: Shades of sovereignty, by Paul Wilson
An essential and stimulating read for central bankers thinking about the monetary history of their state in relation to its historical perspective and broad international trends
Book notes: Empire of silver, by Jin Xu
A useful introduction to China’s monetary history, focusing on the last 1,000 years, but not the easiest of reads throughout
How Turkey’s president created chaos in economic policy-making
Observers allege presidential domination of the central bank, unauthorised FX transactions and untrustworthy statistics
Book notes: Monetary policy in times of crisis, by Massimo Rostagno et al
A mass of intellectual effort gives rare insights into the ECB’s inner working, but fails to fully address questions about who really controls inflation
Final frontier? Japan after the Kuroda experiment
The Bank of Japan has pushed monetary easing close to its limit, yet inflation is barely above zero. What happens now?
Should ESG reporting be made mandatory?
As concern around the impact of climate change on businesses grows, many regulators have announced their intentions to include ESG requirements in reporting frameworks
A future-proof RTGS blueprint
Operating hours, access and data standards should all be considered by central banks contemplating an RTGS overhaul
BCB independence and Brazil’s inflation battle
Formal autonomy should help shield central bank from political pressure linked to 2022 elections, but challenges remain
ESG reserves adoption challenged by reliance on sovereign bonds
Higher issuance of government-compliant bonds is insufficient to offer investable alternatives to central banks.
Central bank communications ‘after’ Covid
From crisis responses to coping with sudden digitisation, Covid-19 forced central bank comms teams to innovate fast. How much of it will stick?
Covid-19 has accelerated paradoxical developments in cash usage
Antti Heinonen explores the unusual patterns in banknote demand in 2020 and draws lessons for the future
Larry Summers on stagflation risks, lessons from Delphi and never-ending ‘punch’
The former US Treasury secretary speaks about fiscal ‘overexpansion’, Fed/Treasury debt discord, the pitfalls of ‘unknown unknowns’ and central bankers ‘unable’ to remove the ‘punchbowl’
Agustín Carstens on BIS strategic priorities, innovation and central bank policy
The BIS general manager speaks about policy trade-offs at critical time, tackling NBFIs and the dearth of ‘green’ assets, tech collaboration, and why he favours Biden’s $3.5trn infrastructure bill
Book notes: Robert Triffin, by Ivo Maes with Ilaria Pasotti
Triffin’s story is well told by Maes, whose extensive personal and academic research shines through on page after page
Do central banks have enough resources to meet tech challenge?
Accelerating technological evolution, difficulties accessing and retaining technical staff, and limited resources will present growing challenges for central banks in the future
Strategies for change: central banks’ quest for diversity
Dedicated diversity strategies remain uncommon among central banks, despite growing recognition of the need for better minority representation
Book notes: How boards work, by Dambisa Moyo
Moyo offers insights into the skills required to be a valued board director, as well as a thought-provoking list of issues that may appear with greater frequency on future board agendas
Some philosophical questions about the future of central banking
Kenneth Rogoff weighs up the many challenges facing central banks in the years ahead, from debt and inflation to negative rates and the dangers of ‘mission creep’
Is the ECB’s strategy review enough?
The reformed framework may allow greater stimulus to tackle weak inflation expectations, but the Governing Council is already divided on what to do next
Fixing market-based finance: duct tape or deep reform?
Central banks are increasingly having to act as market-makers of last resort. But deeper reforms may be needed to avoid stretching their balance sheets to breaking point
Book notes: Fintech regulation in China, by Robin Hui Huang
The book includes meticulous exploration of detailed regulations across the Chinese fintech sector, but risks missing some of the bigger picture due to China’s on/off oversight