Monetary policy
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
Sarb deputy says political uncertainty will affect policy normalisation
Mminele asks whether central banks will enforce notion of economic slack as forward guidance reaches limits; political uncertainty rocking the policy landscape
BoE’s Vlieghe: good policy is more than accurate forecasting
MPC member says doctors cannot forecast heart attacks, but are still pretty useful before and after the event
‘Ambitious’ capital markets union necessary – Constâncio
Better eurozone capital markets would smooth regional shocks, ECB vice-president says
Mexican deputy: EMs should broaden trade strategy in wake of uncertainty
He takes note of uncertain political environment and what impact it could have on trade for emerging markets; exploring trade of services could be one option
Fed’s Jeffrey Lacker quits over information leak
Richmond Fed president resigns after admitting he leaked information from the September 2012 FOMC meeting; Lacker failed to report indiscretion on three occasions
Uncertainty matters for forward guidance success – BoE paper
Authors show that introducing uncertainty generates significantly different macroeconomic effects, with implications for policymaking
Haldane: central banks could ‘gamify’ communications
The game Monopoly could be the next tool in central bank’s communication toolbox, Haldane says, warning complex language breeds distrust
Inflation worries prompt further action from Mexico
Mexico slows pace of rate hikes amid inflation worries and volatile exchange rate; monetary policy committee will closely watch US economy, latest announcement says
Bank of Israel revamps policy communications
New approach to communicating monetary policy decisions as committee moves to an eight-meeting cycle
End of ‘hiking cycle’ has been reached – Sarb’s Kganyago
South African Reserve Bank publishes improved inflation forecast as the MPC votes to leave interest rates at 7%; uncertainty around the exchange rate is still a concern
IMF working paper examines the impact of “de-cashing” on monetary policy
IMF working paper examines the impact of “de-cashing” on monetary policy, claiming transmission would become “easier” and “faster”
Bank of Ghana starts to unwind tight monetary policy
Central bank slashes interest rates to 23.5% in largest cut since 2010; inflation shows signs of improvement but certain risks still loom over prices
Extended monetary easing in US has larger impact abroad – paper
IMF paper examines the impact of periods of prolonged monetary easing on risk-taking behaviour; leverage ratio and other measures of vulnerability increase
Book notes: Competition and Stability in Banking, by Xavier Vives
Xavier Vives has written a fascinating book that highlights many important issues in banking regulation. But there are some flaws in his argument
Women on policy boards support prudent decision-making – research
Paper examines the impact of women on monetary policy decision making; authors’ results reveal the presence of women tends to lead to more “hawkish” decisions
PBoC appoints two to monetary policy committee
Guo Shuqing and Ding Xuedong join policymaking panel in reshuffle of senior officials
Third of businesses think investment has been ‘too low’ – BoE survey
Bank of England publishes results of survey of UK firms in latest quarterly bulletin; businesses experienced both real economy and financial “obstacles” to investment
Turkey keeps tightening with secondary instruments
Hike in late liquidity facility gives room for further tightening, as the central bank responds to inflation hitting double figures
BoE’s Forbes dissents as inflation looms
MPC member votes for 25bp hike as inflation looks set to exceed target until “at least” 2020; other members sitting on the fence, for now
Fed delivers 25bp hike
Fed makes rate hike that many FOMC members have been hinting at for weeks; committee gives bullish signals on the outlook
IMF research uncovers ‘puzzling’ effect of QE on the current account
Authors see QE having significant impact only when capital mobility is low; findings suggest “unexplained variation” between QE and capital mobility
Tanzanian central bank slashes discount rate
Central bank cuts discount rate for the first time since 2013, from 16% to 12%; increase in NPLs has discouraged commercial banks from lending
Finnish paper analyses Chinese central bank’s ‘window guidance’
PBoC may have to move away from using lending quotas, researchers argue