Emerging markets
Davos panellists highlight risks posed by strong dollar
At the World Economic Forum, experts underline the risks of a strengthening dollar on not only US monetary policy, but also on emerging markets’ economies
2016: The year in review
The past year was characterised by dramatic political events, and central banks did not always manage to stay above the fray; we look back at some of the biggest stories
Paper examines “puzzles” in monetary policy transmission
HKIMR paper highlights differences in monetary policy transmission between advanced and emerging markets; “puzzles” are more severe for emerging markets
BIS: markets less beholden to central bank action
Political shocks appear to have jolted markets into a more healthy state, but it is not yet clear if this is the start of normalisation or a temporary phase
Colombian paper models non-linearity in sovereign risk
Model of real exchange rates seeks to capture the non-linear effects of sovereign risk for Latin American countries
Ringgit NDF market collapses after central bank curbs
“Implicit threat” to banks active onshore if they continue trading non-deliverable forwards
Financial globalisation only good within limits, says Canada’s Lane
Timothy Lane flags the dangers of an open capital account for some countries, saying monetary policy in some countries may be “overwhelmed”
Emerging markets hit harder by US rate hikes than domestic policy – Bank of Korea paper
US rate hikes have a larger impact on growth and financial flows in emerging markets than changes in domestic policy, researchers find
First BIS survey data on central clearing shows gaps remain
OTC derivatives surveys capture central clearing for first time; data reveals marked differences between classes of derivatives and advanced vs emerging economies
Central banks respond as markets roiled by Trump victory
Mexico hit by large capital outflows, while Swiss and Japanese central banks face large inflows; Federal Reserve likely to come under pressure
Macro-prudential policy can guard against global volatility – BoE paper
Tighter macro-prudential policies appear to reduce the sensitivity of capital flows to global volatility, paper finds
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
IMF: rise of non-banks is reshaping policy transmission
Pass-through of monetary policy grows as non-banks become more important, but changed transmission mechanism demands better data to understand risk-taking channel
Inflation expectations more sensitive near the zero lower bound – IMF study
IMF study examines whether monetary policy can boost inflation in constrained environment; countries near zero lower bound could see inflation respond more to shocks
Better swap lines could support global co-operation – BIS’s da Silva
Improving the global network of swaps, particularly between advanced and emerging economies, could create a more stable system, deputy general manager says
Declining inflation reduces pass-through effects for emerging markets – BIS paper
Central banks should be less fearful of floating their exchange rates; emerging markets should take note exchange rate channel could be “less effective” in affecting inflation
BIS survey points to turnaround in global forex volumes
Latest survey suggests more than a decade of growth may have come to an end, as data points to a restructuring away from spot trades towards derivatives
FSB looks to halt correspondent banking decline
Board says it is working on filling data gaps, clarifying regulatory demands and building local capacity as signs point to a sharp decline in parts of the world
Property prices closing in on pre-crisis levels – BIS statistics
Statistics for the first quarter show advanced economy prices approaching levels last seen before the financial crisis, but emerging markets see a dip; research links house prices to credit conditions
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
Data gaps hamper work on emerging market vulnerabilities – BIS paper
Large debt stocks, particularly in foreign currencies, point to vulnerabilities in some emerging markets, but gaps in the data are hampering analysis, BIS economists say
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
Prepare to fail
Jesper Berg offers advice to those looking to build financial stability frameworks, and says failure has to be part of the package
BIS: Central banks playing for 'high stakes' as financial cycles turn
Central banks need to lean against financial cycles but fiscal policy should come to their aid, BIS says; cycles may be turning in opposite directions in advanced and emerging economies