Eurozone
Researchers find ‘strong evidence’ of ECB policy spillovers to CEE countries
Working paper examines the spillover effects of the ECB’s ‘non-standard’ measures since 2007 on the Czech Republic, Hungary, Poland and Romania
ECB flags threat of ‘abrupt reversal’ in risk premia
Latest review identifies two ‘medium-level systemic risks’ to the eurozone's financial stability, weak profitability prospects for banks and a potential ‘sharp adjustment’ in risk premia
Buch keen for macro-prudential tools despite no guarantee of use in ‘near future’
Bundesbank’s deputy president says it is important the authorities have the ability to nip ‘any unwelcome developments’ in the real estate market in the bud, should they arise
‘We will do what we must’ to hit target, says Draghi
ECB governor hints at further easing at next month’s monetary policy meeting
Honohan sets out virtues of new crisis tools in final speech
Irish governor stresses potential of direct recapitalisation and GDP-linked loans to help bolster debt sustainability in crisis-hit countries; expects successor Lane to come in with ‘big broom’
Visco questions sufficiency of five presidents’ report
Italian governor stresses progress ‘on the side of the political union’ should be considered sooner rather than later; broadly supports direction of roadmap
BIS paper models non-linear eurozone crisis impact
Researchers attempt to capture endogenous amplification mechanisms in causing widened lending spreads during eurozone crises
Decisions on ELA could be shifted to ECB
Mario Draghi says ‘intricate’ framework for providing emergency liquidity assistance could be reviewed in light of banking union; potential for decisions to become ‘more European’
Asset purchases having ‘sizeable’ impact on prices in eurozone, ECB paper finds
Working paper says ostensibly puzzling result can be explained by low levels of ‘market distress’ weakening some transmission channels but bolstering others
Eurozone macro-prudential policy should be ‘streamlined’, says Belgian director
Mathias Dewatripont praises shared responsibility as a ‘clever idea’ at ECB forum, but acknowledges this ‘leads to some complex procedures’
Paper explores whether governments prefer under-capitalised banks in crises
Governments may prefer banks to be weakly capitalised as this increases the likelihood they will act as buyers of last resort for domestic debt; paper considers impact on regulation
Eurozone banking sector less reliant on central bank funding, ECB report says
Commercial banks relied less on central bank financing in 2014 and only achieved ‘moderate’ extension of credit; shadow banking sector becomes increasingly important
European banks ‘lagging behind’ in re-thinking strategies, Bundesbank board member says
European commercial banks have been too slow in adapting to a changed regulatory environment and low interest rates, says Andreas Dombret of the Bundesbank
Countries under credit stress should ‘front-load’ fiscal consolidation, says ECB paper
Front-loading will bring confidence effects, the working paper suggests
ECB sparks bank tug-of-war over debt eligibility
The European Central Bank may force local regulators to choose whether banks can use senior debt for TLAC or to access its liquidity programme – setting G-Sibs against regional banks
ECB working paper links tight credit conditions to large investment cancellations
Industries most reliant on bank debt in eurozone worst hit by negative bank credit supply shocks, ECB paper finds
External debt is Greece’s perennial Achilles heel, economists warn
Cycles of external debt and dependence are ‘perennial themes’ for Greek crises since 1829, and other countries may be similarly vulnerable, Carmen Reinhart and Christoph Trebesch argue
Carney wants ‘clear principles’ to safeguard non-euro members
Bank of England study of EU membership finds union has broadly contributed to ‘dynamism’ in the UK economy, but imposition of regulation from afar may not suit UK needs
Polish governor criticises five presidents’ report
Marek Belka says proposals contain ‘some good ideas’ but are ’timid and vague’ about what should be done in the longer-term; speaks alongside Ewald Nowotny at Warsaw conference
ECB watching oil and euro closely for inflation risks
Deflation has become less likely in the eurozone since the implementation of quantitative easing, but falling oil prices are pressing on inflation expectations, governing council says
IMF working paper explores spillovers between United States and eurozone
Spillovers from the eurozone to the US have been ‘considerable’ since 2014, reflecting policy easing in Europe, IMF paper notes
Cyber attacks could represent systemic threat, warns Ireland’s Roux
A string of cyber attacks on financial institutions could start a ‘domino effect’ that triggers a financial crisis, so firms need to improve their defences, deputy governor says
People: FCA names COO; RBA shuffles assistant governors
Financial Conduct Authority announces Georgina Philippou as COO; Michele Bullock named assistant governor for business services in Australia; and more
Draghi: too early to judge impact of global events on eurozone inflation
Mario Draghi says slowing growth in EMs, strong euro and weak commodity prices have ‘renewed downside risks’ to outlook; Peter Praet says eurozone still ‘going through correction phase’