Operating framework
BIS’s Shin argues bank capital underpins both monetary policy and financial stability
Research sheds light on tension between bank shareholders and wider society, as high levels of capital support lending and therefore affect the real economy as well as the financial sector
Reserve Bank of India modifies liquidity framework
Rajan spells out plans to “progressively lower” the liquidity deficit in the banking system as part of a broader shift in focus; RBI cuts policy rate by 25bp with inflation on track
West African union must improve monetary transmission, IMF staff say
The West African Economic and Monetary Union must increase the effectiveness of monetary policy, IMF staff say; reforms should target bank refinancing and government securities markets
Turkish central bank narrows rate corridor with cut
Central bank begins process of narrowing rate corridor in last meeting of Erdem Başçı’s term, though it keeps the policy rate on hold
Four largest eurozone economies show different reactions to monetary policy, paper finds
The economies of Germany, France, Italy and Spain show marked differences in responding to policy rate rises, researchers argue
IMF paper explores spillovers from conventional and Islamic finance
Research considers how monetary policy should adapt to the different stages of development of Islamic finance, and its interactions with conventional finance
Deputy governor warns of perils in changing Sweden’s inflation target
Sweden would only be able to raise its inflation rate successfully if other major economies around the world did also, deputy governor Ohlsson says – competiveness would disappear
Bank capital matters for risk-taking channel of monetary policy, Norges Bank paper finds
Less capitalised Norwegian banks are more likely to extend credit to risky firms in response to a cut in the policy rate, author finds
BoJ spells out operational details for negative rates
Policy board will review exemptions from negative interest rate every three months; banks given new incentive to borrow from the central bank under its targeted programmes
Inflation target and interest rates about right, UK survey suggest
Median expectations of inflation for 2016 were 1.8%; largest share of UK public says it is best for the economy if interest rates stay where they are
BIS paper: short-term interest rate may no longer be enough to set policy
Globalised debt markets, the falling long-term interest rate and dollar debt accumulation has altered every major aspect of the monetary transmission mechanism in emerging markets, authors say
Eurosystem reveals rules on national asset holdings
ECB publishes an agreement governing the size of ‘non-monetary policy holdings’ at national central banks in the eurozone; aggregate net financial assets totalled €490 billion at end-2015
Kosovo’s ELA rules are ‘major improvement’, say IMF staff
Central Bank of the Republic of Kosovo adopts regulation setting out the conditions for emergency fund provision; staff at IMF welcome the additional ‘detail and rigour’