Europe
IMF remains gloomy on Brexit as UK heads for snap election
Maurice Obstfeld admits IMF was overly pessimistic on consumer response to Brexit, but says supply shock could still bite; global outlook more positive
Reserve managers see politics shaping currency allocations
European political uncertainty weakens confidence in euro, with sterling pressured by Brexit; dollar’s popularity resurgent, despite Trump’s economic policies
DLT not ‘mature enough’ for eurozone usage, ECB says
ECB’s annual report explores progress with distributed ledger technology, emphasising it is still in its infancy; DLT could eventually be used for Europe’s payment and securities settlement systems
Little EME volatility spillover from Fed/ECB balance sheets
Central bank policies had little impact on volatility in EMEs’ real markets – researchers
Central banks could intervene on repo market function – BIS study
Markets still in a “state of transition” but some central banks might want to take action to mitigate adverse effects, CGFS report says
People: Interim deputy for Ireland; Turkish MPC member quits
Ireland shuffles top positions as Cyril Roux departs; Turkey’s Aysan is returning to academia; Esma appoints new board members
Conservative monetary policy raises banking fragility – paper
Researchers apply a ‘central bank conservatism’ index to data from 73 countries
ECB bond-buying has had ‘significant’ impact on Bund market
The impact of PSPP purchases is substantially higher in stressed markets – Bundesbank paper
Esma calls for greater powers over national supervisors
Supervisor also wants the authority to pause the application of some rules
Brexit will be ‘litmus test’ for global system – Carney
Global financial system has reached “fork in the road”, says Bank of England governor; UK financial firms told to submit robust set of Brexit contingency plans by July
Book notes: Architects of the Euro, edited by Kenneth Dyson and Ivo Maes
This biographical study of the 10 key players in the development of the Economic and Monetary Union provides a contrast to more historical analyses
Czech National Bank abandons koruna floor
The central bank is likely to be happy with the market’s reaction, analyst says
Draghi and Praet say ECB will continue with QE
Praet says interest rates should remain low “past the horizon of our net asset purchases”
‘Ambitious’ capital markets union necessary – Constâncio
Better eurozone capital markets would smooth regional shocks, ECB vice-president says
EBA provides guidance on bail-ins under European directive
Guidelines cover shareholders, debt-equity conversions and “grandfathered” assets
Buyers of risk in CDS market highly exposed, ECB paper finds
Researchers analyse credit default swap market using data from 2011 to 2014
Kosovo central bank joins supervisory agreement with EBA and neighbours
Supervisors from five other parts of former Yugoslavia joined in 2015
ECB set for €50 note launch
The European Central Bank is to launch the fourth banknote in the new Europa series on April 4; the new note will retain design elements from previous series, but will feature revamped security features
Eurozone instability tops reserve manager fears – survey
Threat of instability or weakness in the eurozone and fear of major asset price correction are greatest concerns for reserve managers in 2017, Central Banking survey shows
ECB criticises draft Polish law on foreign-denominated loans
Draft bill could be even more expensive than previously abandoned proposal, ECB says
Be careful of using swaps to track inflation expectations, analyst says
Be careful of using swaps to track inflation expectations, analyst says
Spanish paper models effects of European ‘fiscal delegation’
Supranational fiscal authority would improve welfare, authors argue
Macedonia links up with EU payment infrastructure
Central bank announces local interbank payment system will connect with Target2 via the Bank of Italy; payments department manager says the development will enable smoother integration with the EU
Transparency International calls for major reforms of ECB governance
NGO says ECB should disavow role in ‘troika’ supervising Greek bail-out