Central Banks
Troika praises Ireland for ‘steadfast’ adherence to programme
Conclusion of eighth programme review says Ireland likely to meet deficit target this year; Portugal by contrast facing ‘strong headwinds’ to fiscal adjustment with 2012 targets beyond reach
Fed’s QE2 will have ‘modest impact’, says San Francisco paper
Research by the Federal Reserve Bank of San Francisco estimates the second round of Fed quantitative easing will have only a small effect on GDP growth and inflation
Macedonian vice-governor assesses impact of European deleveraging
Maja Kadievska Vojnovik says Macedonia has been spared most of the direct effects from deleveraging by European banks largely due to the ‘prudent’ funding structure of local banks
Bank of Finland’s Honkapohja gets second five-year term
Seppo Honkapohja reappointed for a second five-year term on the board of the Bank of Finland; only three board members of a possible six currently in office
FSB resolution paper due in ‘next few weeks’, says BoE’s Tucker
Lack of national legislation on resolution mechanisms has made the drafting of international standards for resolution regimes tricky. But an FSB consultative paper will be issued in the coming weeks
Customer funding gaps fall at Danish banks
Stress tests performed by the National Bank of Denmark show an increase in the capitalisation of the country’s banks; funding gaps shrink as deposits soar and lending falls
Market-based funding growing in South-east Asia, says MAS chairman
Tharman Shanmugaratnam says prospects for non-bank capital funding are growing in South-east Asia
Korean governor wants domestic demand boost
At the latest Bank of Korea financial council meeting, Kim Choongsoo calls for increase in long-run domestic demand; bank presidents raise concerns over SME business environment
Chile funding markets resistant to risk spillovers
IMF study finds funding costs in Chilean interbank and bank bond markets have weathered global risk spillovers well
National production gaps don’t drive stock markets, says Swiss paper
Study by the Swiss National Bank finds global business cycle risks affect stock markets more than any nation-specific production gap
Bank of Israel moves to educate youth
An Israeli financial education programme has widened to include younger people; central bank says this will help strengthen the future position of the consumer in the financial sector
Fed holds fire on further easing
Federal Open Market Committee votes to hold federal funds rate and maintain current scale of asset purchases; concerns persist over labour market conditions, raising possibility of further stimulus
Basel Committee official rebuts criticism over regulatory complexity
Basel Committee secretary-general defends Basel III from critics who argue it is unnecessarily complicated; says additional detail needed to meet the increasing complexity of financial markets
BoE’s King highlights limitations of monetary policy
Bank of England governor says new asset purchase programme is still feasible, but indicates the use of monetary policy to bolster the economy is getting much harder
Draghi defends OMTs in front of German parliament
ECB president answers questions from Bundestag in a bid to address German fears over effect of outright monetary transactions
Embattled Nigerian governor condemns corrupt leadership
Central Bank of Nigeria governor Sanusi Lamido Sanusi says country’s economy is grossly underperforming due to corrupt and ineffectual leadership throughout the country
Korea to miss OTC clearing deadline
It is ‘highly unlikely’ Korea will meet the deadline to start clearing OTC derivatives by January 1, 2013, due to legislative delays, according to market participants
Bundesbank under pressure over $172bn gold inventory
German Federal Court of Auditors calls on Bundesbank to check gold held at Federal Reserve, Bank of England and Banque de France; Bundesbank to move 150 tonnes back to Germany over next three years
Colombian paper proposes measure of systemic importance
Central Bank of Colombia study identifies important characteristics related to size, connectedness and substitutability that determine the systemic importance of financial institutions
French deputy emphasises importance of non-financial sector data
Banque de France deputy governor says information on non-financial companies has vital uses on the micro and macro level, as it helps evaluate collateral and perform stress tests
Finland paper recommends ‘unpleasant reforms’
Research published by the Bank of Finland advocates slowing public sector growth and lowering taxes; will boost labour supply and competition
Bank safety depends on more than high capital, says RBA’s Ellis
Reserve Bank of Australia’s Luci Ellis says higher capital levels alone do not guarantee a bank is safer than its competitors; depends on business model and risk attitudes