Liquidity
Indonesian banks will switch to reserves averaging in July
Latest move in Bank Indonesia’s major overhaul of monetary policy transmission and efforts to deepen financial markets
BIS paper: forces driving global liquidity are shifting
Paper examines factors behind changing patterns of global liquidity, finding improved prudential standards have cut volatility
Growth in offshore funding is creating risks – RBNZ
Financial stability report notes growing reliance of banks on offshore funding sources could become a problem; housing market risks require new prudential tools
Kohn worried about weight of expectations on Federal Reserve
The weight of expectations on the US Fed may be too high; the US is not as well placed as the UK to tackle another major crisis, says the former Fed vice-chair
IMF paper sheds light on solvency and liquidity interactions
Neglecting the “solvency-liquidity nexus” could lead to mistakes in stress-testing models, authors warn
Forex volatility can boost liquidity – BIS paper
Price volatility might not always be a bad thing for market liquidity, authors find
Rajan and Weber: central banks may fail next crisis test
Heavyweight economists say central banks may well find themselves intervening at the next major liquidity crisis, despite ostensible progress on resolution
Lebanese banking sector holding up, despite Syria crisis – central bank
The banking sector remains liquid and well capitalised despite a “strained” Lebanese economy, the central bank says; new compliance unit formed
Esma calls for greater powers over national supervisors
Supervisor also wants the authority to pause the application of some rules
RBI makes fresh amendments to liquidity framework
Central bank continues reforms begun under Raghuram Rajan and asks government for new tools; markets still face “liquidity overhang” from demonetisation
BIS report: build liquidity co‑operation early to prepare for crisis
CGFS report urges central banks to build networks domestically and across borders to have liquidity ready for the next crisis
Basel Committee outlines enhanced disclosure framework
Revised Pillar 3 standard adds “dashboard” of banks’ key prudential metrics and consolidates all existing Basel Committee disclosure requirements
Kenya’s Imperial Bank given 90-day lifeline
High court extends commercial bank’s receivership to allow shareholders and receiver to reach agreement; Kenya’s central bank takes first step toward removing licensing moratorium
BoE research offers insights from new regulatory database
The new database, comprising banks’ regulatory submissions, allows authors to shed new light on the evolution of the UK banking sector in recent decades
Daily open market operations paying off – National Bank of Denmark
Introduction of daily open market operations has smoothed liquidity management, stabilising the money market reference rate
BoE’s Jackson: need to intervene on market function still an open question
Head of forex and reserves management discusses evolving understanding of flash events, market structure, and whether there is a case for further intervention
Latin American central bank interventions 'mitigate' liquidity shocks
Central banks more concerned with global factors than structural changes to forex markets; post-crisis regulation and tech advancements proving problematic for market makers
BIS authors spot structural break in bank financing
Research identifies turning point in how banks fund themselves around 2008, with greater reliance on branches and subsidiaries
Iran needs to overhaul monetary operating framework – IMF
Absence of policy rate and emergency lending facilities is creating instability, fund warns; central bank council “dominated” by representatives from other government agencies
Caruana: financial globalisation is not over
BIS chief says “peak finance” has not arrived, despite signs of a slowdown in global banking activity; warns against inward-looking policy-making
Basel III LCR affects RBI monetary operations – paper
Liquidity coverage ratio affects the central bank’s operational target via its impact on the unsecured overnight money market
Kuroda flags need for better network of emergency forex liquidity
Bank of Japan governor warns network of swap lines among major central banks may not be enough as systemic banks reach into a broader set of regions
Danish paper examines funding costs in stress test scenario
Banks unable to attract funding quickly in a liquidity crisis, author says; model underscores importance of incorporating funding costs into stress tests
IMF gives thumbs up to Indonesia’s new monetary operating framework
Interest rate corridor and switch to new policy rate has improved monetary policy transmission, early data shows, but further reforms could strengthen framework further