Eurozone
Eurozone banks vulnerable to global risk repricing, ECB warns
US elections have “aggravated” risk of global repricing, which could trigger contagion in eurozone financial system, Vítor Constâncio says
Auditors’ report notes staffing and governance issues at ECB arm
National supervisors provide insufficient staff for inspection teams, report says
Visco hits out at lack of ‘cohesion’ among Europe’s political leaders
ECB governing council member calls for targeted structural reforms in the euro area; says a euro area finance minister must have fiscal capability and not be “another referee”
Bundesbank paper models spillover effects of risk shocks in financial crisis
Paper finds spillover effects of general risk are stronger than spillovers in response to bailouts
ECB's bank watchdog warned on NPL clean-up drive
SSM may need clearer enforcement process to boost bad loan provisioning, says regulator
Top US and EU officials hold resolution war game
US, UK and eurozone central bankers, regulators and politicians participate in an exercise designed to improve the co-ordination of cross-border resolution
'Institutional repositories' can boost research – Bank of Spain’s Selgas
Organising materials in an efficient manner online can support research and collaboration, says Bank of Spain’s chief librarian; system expected to launch in 2017
‘Moral suasion’ and yield-seeking intensified sovereign debt crisis – ECB paper
Researchers use information on 226 eurozone banks; publicly owned, recently bailed-out and less strongly capitalised banks engaged increased sovereign bond holdings during crisis
Low growth and low rates to hit financial stability, says IMF
Weak outlook is likely to feed into medium-term problems for financial stability, fund warns; Basel Committee may have to delay agreement on final framework
ECB paper aims to improve small-scale models for assessing policy shocks
Paper outlines a structural factor model, which the authors say better accounts for the asset price impact of monetary policy shocks
Maskin: technocrats should set eurozone fiscal policy
Harvard economist argues a technocratic body similar to a central bank could set spending and revenue targets in eurozone before allowing politicians to determine the details
Liquidity stress testing ‘essential’ – ECB supervisor
Supervisor warns conference that banks will need to shape up their internal liquidity adequacy assessment process responses for 2017
ECB paper examines use of eurozone bank lending survey
Changes in credit standards in the ECB’s bank lending survey serve as leading indicators for GDP and bank loan growth, researchers say
Book notes: And the weak suffer what they must?, by Yanis Varoufakis
A book that is likely to elicit strong opinions – but Varoufakis writes persuasively, and may well win over many of his readers, says David Mayes
ECB paper finds ‘sizeable’ impact from QE
Authors find empirical evidence of various channels through which asset purchases affect the eurozone economy, before testing them in a general equilibrium model
ECB delays decision on policy redesign
Mario Draghi says committees will investigate “smooth implementation” of asset purchases, but offers no new policies today; highlights signs of greater willingness for government action
‘Iconic’ Irish central bank property put on market
No asking price for Dame Street site – sale is by best bid; more than 1,500 central bank staff to move to new site in North Wall Quay
Signs of ‘de-anchoring’ inflation expectations in eurozone – ECB paper
Study finds professional forecasts are paying more attention to ECB inflation projections and less to the target; authors suggest “extensive use of forward guidance” could help
Book notes: The euro and the battle of ideas, by Markus K Brunnermeier, Harold James and Jean-Pierre Landau
The authors have produced a fascinating and informative book that offers suggestions on how differences in beliefs can be overcome
IMF’s crisis performance criticised by internal review
Report evaluates IMF’s handling of eurozone crises from 2010 to 2013; work during programme design and implementation described as ‘uneven’ and concerns raised over political pressure
Model-based regulation in Germany had unintended consequences, researchers say
The move to model-based banking regulation in Germany studied in working paper; loan default and loss rates rose for loans created under new regime
Policy-makers should base analysis on broad set of monetary aggregates, paper argues
Analysis of the stability of demand for components of monetary aggregates in the eurozone argues against reliance on a single measure, researcher says
Draghi: Central bankers must align policies
ECB president calls for greater alignment and better communication of economic policy across national borders; calls for globally co-ordinated fiscal expansion on lines of 2008-09
Irish paper proposes three-phase model of volatility in bond markets
Irish paper finds ‘good’, ‘bad’ and ‘ugly’ phases in eurozone sovereign debt markets from 2003 to 2014; crisis not caused by changes to the shock mechanism, but by pre-existing cross-country links