Research
ECB paper models effects of bank guarantees
Guarantees improve welfare by increasing liquidity transformation, researchers find
ECB announcements in QE era shifted inflation expectations, Austrian paper finds
Researchers use daily data on bond yields and inflation-linked swaps
Finnish paper analyses Chinese central bank’s ‘window guidance’
PBoC may have to move away from using lending quotas, researchers argue
RBA paper assesses FOMC’s forecasting performance
RBA and Fed economists collaborate on study of forecasting errors by the Federal Open Market Committee
Interest rate effects weaker at low levels – Borio and Gambacorta
Supply of loans becomes less responsive to policy rate movements when interest rates are already very low, likely due to impact on bank profits, authors say
Bank of Spain paper calculates implicit public debt thresholds
Researchers build on earlier work and apply models to Spanish data
Basel capital surcharges are too low – Fed paper
Authors argue current Basel standards are not enough to guard against the failure of a global bank, particularly those reliant on short-term funding
Bank of Italy paper looks at impact of monetary policy shocks
The impacts of eurozone and US shocks have diverged since the onset of the financial crisis, the working paper says
BoE paper raises risk of ‘bubbly growth traps’
Asset bubbles can direct resources to low-productivity sectors, which could explain the long hangover from recent crises, author says
Italian paper tracks spreads on eurozone corporate bonds
“Fragmentation” has begun to decrease following ECB’s use of QE, researcher says
Tax cuts affect bank leverage and liabilities – BIS paper
Tax cuts have different effects on different banks, authors find; better-capitalised banks increase their assets, while weaker ones clean up their balance sheets
Basel III LCR affects RBI monetary operations – paper
Liquidity coverage ratio affects the central bank’s operational target via its impact on the unsecured overnight money market
Economic shocks more likely to spread within EU – new research
Researchers use new model to measure propagation of regional shocks in Europe
Government regulation needed for digital currencies to remain secure – paper
Canadian paper draws historical comparison between banknotes and digital currencies, concluding regulation is needed to ensure safety
Researchers dig further into ‘Lazarus’ cyber attacks
Latest effort to crack case of cyber criminals unearths “fairly sophisticated” mechanism to target banks and regulators, and less sophisticated efforts to mislead investigators
Booms spill over less than busts – Riksbank paper
Financial booms appear to affect the real economy less than busts, suggesting macro-prudential policies will outperform “leaning against the wind”
Broad sectors of Irish economy are ‘very connected’ – study
Irish research uses network analysis to look at sectoral linkages
Market discipline stems Level 3 asset manipulation – paper
Bank of England paper shows link between low capital ratios and Level 3 assets between 2008–2013, but market discipline moderates the impact from accounting discretion
Tech-related mismeasurement not to blame for 2004 slowdown
Fast growth between 1995 and 2004 is the “anomaly”, the authors suggest; further productivity growth is expected when the potential of latest advancements is realised
FOMC sentiment effects tested with ‘computational linguistics’
Economists find sentiment conveyed by FOMC statements affects policy expectations, inflation, and industrial production
IMF paper examines bank lending in Saudi Arabia
Despite low oil prices, credit to the private sector “remained robust”, but an overreliance on banks financing the deficit needs to stop, author says
ECB paper models causes of flash crashes
Informational asymmetry and thin participation can cause liquidity problems, paper argues
Only struggling banks cut lending to raise capital ratio – IMF paper
Study of Eastern Europe says banks' strategy matters when it comes to assessing the impact of Basel III; only banks with low profitability cut lending to meet requirements
Danish paper examines funding costs in stress test scenario
Banks unable to attract funding quickly in a liquidity crisis, author says; model underscores importance of incorporating funding costs into stress tests