Central Banks
Former Bulgarian deputy charged with ‘abuse of office’
Rumen Simeonov accused by prosecutor of not taking action on failed Corporate Commercial Bank despite knowing the institution was in trouble
Bank of Finland paper tests price-level based forward guidance
Seppo Honkapohja and Kaushik Mitra use ‘adaptive learning’ approach to show price-level targeting can outperform inflation targeting under some circumstances
US has chance to maintain leadership despite China’s AIIB
London School of Economics’ Danny Quah tells Central Banking the US must not cling dogmatically to its view of the world if it is to remain influential – and sharing power need not be all bad
Balkanisation of bank lending has made recipient countries safer, says IMF
Analytical chapter from upcoming financial stability report highlights benefits of reduction in certain cross-border credit flows
Linde: ECB’s QE is already ‘bearing fruit’
Households and families are enjoying better financing conditions due to the ECB’s quantitative easing programme, argues Luis Linde, governor of the Bank of Spain
Chilean paper calls on policy-makers to consider source of shocks
Policy-makers in Chile ‘have to take into account the source of the shock when evaluating possible policy options’ in response to copper price shocks, research finds
Iran nuclear deal paves way to lift central bank sanctions
Deal struck between Iran and UN paves way for tough sanctions on the central bank to be lifted and Iranian banks to return to Swift payments system
BoE’s FPC flags climate change financial stability risks
Financial policy committee divides issue into physical risks and transitional risks, seeing some potential for instability from climate change but calling for further research
Colombian paper analyses intraday liquidity needs
Intraday liquidity risks can be ‘mitigated or even eliminated’ if entities have higher opening balances than the balances required to opportunely liquidate all payment obligations, paper finds
Bank of Portugal launches mobile app
Users can access key statistical indicators for Portugal and the eurozone, calculate foreign exchange rates and obtain interest rate simulations, in the first Portuguese central bank app
Bundesbank's Dombret: shadow banking oversight is 'miles away'
Regulators may never be able to fully monitor the risks created by shadow banking, says Bundesbank board member
IMF calls for demand boost to avoid 'new reality' of lower potential
IMF World Economic Outlook contains echoes of Larry Summers' view that the world's economies need shock therapy to avoid secular stagnation
Fed officials renew calls to tackle inequality
Janet Yellen highlights need for further research into income inequality, while Lael Brainard focuses on young people and Narayana Kocherlakota on Native Americans
Solomon Islands research illuminates inflation sources in small islands
Working paper finds domestic factors are mainly behind inflation outcomes, with the exchange rate only having a temporary impact; economy takes around a year to bounce back from shocks
Rates have hit lower bound, say ECB minutes
Second ‘account’ of ECB policy meeting suggests -0.2% is the effective lower bound for interest rates, but governing council mulls various options for extending QE should it be necessary
Expectations have variable impact, finds ECB paper
Working paper suggests there have been ‘significant changes’ in the degree to which expectations have driven unemployment, with a particularly large effect during 2008 financial crisis
Fed paper measures damage from capital flow surges
Researchers find surging capital flows push labour away from manufacturing, create sudden booms and recessions, and do more damage if there is a sudden reversal
The MPC process in light of the Warsh Review
The Bank of England’s revised MPC meeting schedule has some merits but will not add to transparency and raises the risk of news shocks, writes former member Charles Goodhart
Israel’s Flug calls for new financial stability committee
Bank of Israel governor wants to ‘institutionalise’ collaboration between financial supervisory authorities; offers advice to new government on budget
Global FX reserves down, dollar allocations up
Valuation effects push US dollar portion of allocated reserves higher while euro slips
MAS to launch 'unique' government-guaranteed retail bond
Interest on the non-tradable, 10-year bond will increase annually and savers can bow out at any time; product is unique in Asia, analyst says
People: NY Fed names first vice president; HKMA promotes research head
Michael Strine succeeds Christine Cumming as first vice president at the Federal Reserve Bank of New York; Lillian Cheung becomes executive director for research in Hong Kong; and more