Debt Management
Can Japan afford to grow?
Japan has managed to maintain living standards during its two ‘lost decades’, but its efforts to do so now represent obstacles to achieving sustainable growth. By Ryo Watabe.
Germany's concerns about the ECB’s bloated balance sheet
The ECB’s unconventional monetary policy actions have caused a stir in Germany. The Bundesbank's Joachim Nagel speaks with Klaus Engelen about the risks the ECB now faces
Central Bank of Ireland highlights varied success of aid programmes
Research note examines progress of five European countries with EU-IMF programmes towards meeting debt sustainability targets; warns Ireland is likely to miss targets
IMF working paper warns of dangers in sovereign debt restructuring
Researchers find debt restructurings have adverse impact on economic growth; say debt sustainability is a crucial consideration
RBNZ governor weighs impact of debt burden on growth
Alan Bollard says large accumulation of private debt prior to financial crisis contributing to a ‘tepid’ recovery; argues a rebalancing of the economy is still to come
IMF paper studies effect of global environment on domestic bond yields
Working paper analyses link between global economic conditions and emerging market domestic bond yields; finds financial market turmoil raises sensitivity to government spending increases
Fischer calls for Israeli government action on deficit
Bank of Israel governor says government’s decision to increase its fiscal deficit instead of raising taxes will hurt future generations; impact will be most acute should eurozone fragment
IMF urges US policy-makers to take action against fiscal cliff
Conclusions of IMF Article IV consultation with US highlight risks from fiscal cliff and debt ceiling; calls on policy-makers to strike deal at ‘delicate juncture’ for world economy
IMF paper warns against delays in Japanese fiscal consolidation
Working paper studies impact of budget deficit in Japan on intergenerational inequality; finds delaying budget cuts would adversely affect younger generations
IMF paper warns against frontloaded fiscal adjustment
Working paper studies changes in fiscal multipliers based on economy’s position in the business cycle; cautions that large budget cuts are likely to create or worsen recessions
RBI research examines debt management conflict of interest
Working paper discusses whether the Reserve Bank of India’s dual monetary policy and debt management roles affect price stability mandate; finds little evidence of impact
IMF paper finds stronger and more complex fiscal rules following crises
Working paper compiles dataset of national and supra-national fiscal rules; suggests rules were strengthened after crises in the 1990s and after the financial crisis
RBI shuns foreign investors and derivatives in favour of structural ALM, says former deputy governor
Shyamala Gopinath believes market structure and regulation can be used to create ‘natural’ asset and liability management; approach is superior to managing risks with financial hedges
IMF paper examines impact of financial crisis on US state finances
Working paper studies effect of balanced budget rules at US state level; finds pro-cyclicality but suggests this could be mitigated without changing the rules
ECB paper studies sovereign debt and growth links
Working paper studies relationship between different levels of sovereign debt and growth; finds increasing debt only boosts short-run growth up to a certain threshold
Central Bank of Colombia paper analyses sovereign default risk
Working paper assesses main factors determining risk of Colombian government defaulting on its debt; finds different factors are important at different debt maturities
IMF paper analyses US capital flows and debt
Fund working paper develops model of international capital flows and resulting impact on debt dynamics; finds equity and FDI returns allowed US to maintain high debt levels
Israel’s Fischer calls for government to cut deficit
Stanley Fischer says Israeli government must cut its budget deficit to prepare for possible economic shocks from Europe; argues government should aim for deficit of 2.5% of GDP
ECB’s Asmussen attacks delays to Greek reforms
Jörg Asmussen says Greek government must get reform programme 'back on track'; blasts "reluctance" to implement necessary reforms
IMF paper studies debt sustainability in low-income countries
Working paper considers effect of financial crisis on debt sustainability in low-income countries; finds short-term impact but a return to sustainable levels in the longer run
Euro group agrees on single banking supervisory mechanism
Umbrella supervision body 'run by ECB' to be established; exhausted EC president refuses to discuss details of plan to directly recapitalise European banks
Fed paper examines balanced budget rules
Working paper considers whether balanced budget rules affect spending at different levels of government; finds rules impose discipline on the states but have little impact on federal spending
IMF paper examines changing bond demand
Working paper considers changes in investor demand for government bonds after the financial crisis; finds lower yields shift demand from foreign to domestic investors
Dallara to leave IIF after 19 years
Charles Dallara will leave the IIF in the "coming months" after 19 years as managing director; search for a replacement is on-going