Central Banks
IMF sees limits to Norway ‘leaning against the wind’
Article IV conclusion says macro-prudential policy should be first line of defence, but governor Øystein Olsen still sees role for monetary policy
Austria to repatriate third of gold reserves
Central bank plans to move gold out of the UK and into Austria and Switzerland after court of audit raises concern over ‘high concentration risk’
Five problems with floating rate exchange regimes
Robert Aliber bemoans the dangers of sharp moves in major currencies that are the result of floating rate currency regimes, and answers five rhetorical questions related to monetary stability
Shadow banking risks ebbing in China
China has the world’s third-largest shadow-banking sector, but the risks it poses to the overall financial system are overstated, especially following moves by the State Council
Devising effective data strategies to help inform policy decisions
The publication of the Irving Fisher Committee’s report on good data practices offers the potential for powerful data sharing, but more work needs to be done at the tactical and practical levels
Kocherlakota sets out path back to maximum employment
Minneapolis Fed president says the FOMC should set policy in a way that allows for at least three more years ‘as good as 2014’ if the labour market is to achieve highs last seen in 2006
Central banks face weight of expectations in sub-Saharan Africa
The art of central banking has changed dramatically in frontier markets. Monetary policy, financial regulation, capital flows and exchange rate are now centre stage, writes Louis Kasekende
Central bank liquidity surge is not without historical precedent
Major central banks have injected $14 trillion of liquidity into the global economic system, but such surges are not without historical precedent
Assessing the value of financial stability reports
More than 90 central banks now produce financial stability reports. Emrah Uslu and Eyup Kahveci look at the various approaches they take as well as appraising their usefulness.
Book notes: Monetary policy and financial repression in Britain 1951–1959, by William A Allen
A fascinating and coherent account of British monetary policy in the 1950s
Book notes: Smart Money, by Andrew Palmer
An important attempt to show how financial innovation is “reshaping our world for the better” all the more important
Book notes: The media and financial crises, by Steve Schifferes and Richard Roberts
A fascinating book, which gives a very different perspective on the financial crisis and its predecessors
Book notes: Hall of mirrors, by Barry Eichengreen
A scholarly, but readable narrative that interleaves an account of the build-up to and course of the Great Depression with the similar course of events in the Global Financial Crisis
Swiss National Bank open to buying foreign assets
IMF article IV report suggests buying foreign assets to address deflationary pressures; Swiss National Bank says it is an option but wants to see how outlook develops before easing further
Riksbank launches streamlined financial stability report
Shorter, more focused report aims to send clearer message to readers; follows close on the heels of a redesigned monetary policy report
ECB paper highlights stability and growth benefits of market-based finance
Researchers suggest high bank leverage may be amplifying booms and busts, damaging both financial stability and economic growth, with one solution being more market-based finance
ECB article calls for ‘consistent’ macro-prudential policies
Article in latest financial stability review says policies should be applied consistently across the eurozone to avoid spillovers
Micro-prudential policy ‘bulwark’ against systemic risks, says San Fran Fed’s Williams
President says prevalence of shadow banks limits use of conventional macro-prudential tools, but there are other ways to integrate the perspective into the regulatory framework
Central Bank of Iceland prepares for ‘substantial’ interest rate increases
Minutes show MPC grappling with uncertainty around pay increases but board members agree interest rates will soon have to move upwards sharply; one member dissented from rate hold
Dutch committee recommends 90% LTV limit on mortgages
Netherlands financial stability committee advises government to gradually reduce loan-to-value limit to 90%, despite IMF recommending cut to 80%
Second Hong Kong sukuk oversubscribed by 100%
Five-year Islamic bond hits home with investors, including central banks, pushing coupon below 2% – 35 basis points above US Treasuries with same maturity
Solomon Islands governor shifts financial inclusion focus
Denton Rarawa tells Central Banking the Solomon Islands will meet its target for access to financial services early, and work on improving usage and quality should come next