Economics
Dallas Fed studies debt impact on exchange rate fluctuations
Countries that are most vulnerable to a sudden shift in capital inflows and a sudden fall in the capital account have ‘a large stock of net non-foreign direct investment external liabilities’
Spanish paper analyses financial innovation in sovereign debt
Working paper published by the Bank of Spain studies how financial innovation in sovereign debt markets can increase a country’s level of private investment and welfare
IMF paper proposes refinements to potential output estimation
Researchers use an adapted ‘multivariate filter’ that aims to improve upon other methods of estimating potential output, although they admit the result is probably only the ‘least worst’ option
Lagarde warns mediocre growth could become ‘new reality’
The "global recovery continues, but it is moderate and uneven", argues the IMF managing director, warning mediocre growth has the potential to become the "new reality"
Global economy in ‘unprecedented scenario’, says Linde
The global economy faces an "unprecedented scenario", including "risks to financial stability and possible highly volatile movements in the prices of financial assets", says Bank of Spain governor
Varoufakis defends reshaped Greek reform agenda
Greek finance minister says extension bought time for a ‘serious conversation’ with creditors and outlines ways in which he wants reforms to differ from troika prescriptions
ECB research assesses fiscal impact of bailouts
ECB paper analyses the impact on a government’s fiscal position of assistance measures; finds majority of the financial needs (4.9% of 5.1% of GDP) were recorded is first three crisis years
Chilean paper analyses unemployment’s impact on wages
The impact of unemployment spells on wages is high, but the volatility ‘increases much more during recessions’, research finds
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
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
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
Central Bank of Iceland hails successful year
Annual report for 2014 shows inflation fell, central bank introduced prudential measures in preparation for capital account liberalisation, and profits returned to positive figures
CNB paper questions strength of ‘border effect’
Studies using outdated methodologies overestimate the impact of national borders on trade, authors say; effect is stronger in emerging markets
ECB paper emphasises importance of time horizons for early-warning models
Working paper finds the selection of a particular time horizon can have ‘considerable implications’ for the performance of economic variables in predicting bank crises
Bank of Israel studies economic damage from conflict
Latest hostilities between Israel and Palestine cost the Israeli economy around 0.3% of GDP, with effects stemming from falling tourism and lower consumption, annual report finds
Iceland expects ‘significant’ progress in lifting capital controls this year
Healthy economy and sturdy banking system pave way for lifting of capital controls, but risks are 'tilted to the downside', IMF report says; central bank at a ‘difficult juncture’
Research considers effects of delaying fiscal consolidation on GDP
Working paper published by the IMF finds there are no ‘substantive gains’ to be had in GDP from delaying consolidation if multipliers are constant
French paper models flattening Philips curve
Working paper develops a two-country, new-Keynesian model to replicate the flattening of the curve in developed countries over the past 25 years, a trend widely attributed to globalisation
IMF researchers add eurozone detail to fund’s global projection model
Working paper adds ‘blocks’ for Germany, France, Italy and Spain to the model in an effort to capture the dynamics in the eurozone in greater detail
Colombian paper analyses relationship between term premia in US and Latin America
Brazil and Colombia are the Latin American countries with the largest responses to changes in the US term premium, according to research published by the Central Bank of Colombia
Paper tackles US inflation puzzle with new Phillips curve
Authors of research published by IMF find core inflation movements can be explained by anchored expectations and short-term unemployment “stories”
BoE unveils wide-ranging research agenda
‘One Bank’ research agenda seeks to shake up the status quo and help theory catch up with the practice of new central bank mandates and looming challenges
Haldane wants to turn economic methodology on its head
BoE chief economist turns away from deductive methods and towards mining big data in search of correlations, but former ECB research director warns him to temper his enthusiasm