Eurozone
ECB paper traces roots of falling financial integration
Policy interventions beyond traditional capital controls may have ‘unintended’ impact on financial integration, including some macro-prudential measures based around currency
First Target2 data release sheds light on imbalances
Data on cross-border eurozone financial flows gives clarity as to the sharply different directions funds have been travelling, with Germany still comfortably the most popular destination
ECB sees house prices undergoing ‘sustainable’ recovery
European Central Bank says eurozone housing markets appear to have undergone necessary corrections, in article released ahead of Economic Bulletin
Danièle Nouy targets greater regulatory harmonisation
Supervisory board chair highlights efforts taken to harmonise regulatory framework in Europe but stresses more must be done; says SSM is ‘working very well’ as it approaches first anniversary
BoJ’s Shirai explains why negative rates fit Europe better than Japan
Policy board member Sayuri Shirai says impact of rates varies according to market structure, noting differences in the type of investors and credit conditions in the jurisdictions
ECB concerned by impact of draft German law on supervision
European Central Bank suggests proposals could impact consistency across the banking union and its own supervisory discretion in response to Federal Ministry of Finance
Former COO of BNP nominated as Banque de France governor
François Villeroy de Galhau picked by French president to succeed Christian Noyer as central bank head; past experience includes BNP Paribas and French treasury
German reforms did not create eurozone imbalances, paper finds
German model illustrates the positive effect of structural labour reforms between 1999 and 2008 on GDP, consumption, investment and employment, but also the eurozone more widely
ECB paper makes case for Bayesian model averaging in stress-test models
Working paper highlights the differences between using Bayesian model averaging and a series of handpicked equations
Finland governor donates month’s pay to help refugees
Erkki Liikanen will donate €10,000 to the Red Cross to help refugees; Mario Draghi says any European should be ‘horrified by the tragic loss of life happening on our doorstep’
ECB spruces up premises with tree sculpture
Italian artist creates 17.5 metre sculpture of a tree using bronze and granite to be displayed at the main entrance of the European Central Bank’s headquarters
Draghi stresses willingness to act as ECB cuts inflation forecasts
Governing council holds policy as ECB staff cut inflation forecasts over the forecast horizon; Mario Draghi stresses QE could run beyond September 2016 if necessary
Finnish deputy: international competition will change mortgage lending
Bank of Finland deputy argues conditions for international competition in mortgage lending are ‘improving’ and there is the potential for a ‘substantial impact’ in the eurozone
National Bank of Denmark calls end to crisis measures
Central bank has moved from buying to selling foreign exchange in recent months, opening up room to return deposit limits to more normal levels and re-start government bond issuance
Irish central bank paper finds high cost to hasty austerity
Economists find most of the costs of fiscal consolidation from 2011-13 could have been avoided if policy-makers waited until the zero lower bound was no longer a constraint
Weidmann wary of monetary policy ‘being further co-opted’
Bundesbank president makes case for changes to institutional framework underpinning the monetary union, calling for discussion of ‘Maastricht plus’ and political union
Eurozone inflation ‘may well have’ reached turning point
ECB governing council members suspect underlying inflation reached a turning point earlier this year, but feel it is too soon to say for certain, accounts from July meeting show
Central Banking poll respondents back 'Grexit'
In a narrow majority 87 out of 155 readers say Greece should adopt a new national currency; asked about a variety of monetary systems, most backed a free-floating regime
ECB researchers examine flight to safety during sovereign debt crisis
Working paper tracks geographical distribution of capital flight, finding different movements by intra-eurozone and external investors; movements ceased when OMTs were unveiled
ECB paper models joint default risk with fat tails
Researchers reject normal distribution in favour of one with fatter tails, find ‘unprecedented’ tail risks in 2011-12 fell sharply after the OMT announcement
Bundesbank’s Buch casts doubt on Greek debt relief as talks end
Deputy president takes stance at loggerheads with IMF as latest round of negotiations draws to a close; Greek finance minister strikes upbeat note
Market expectations respond to contractionary shocks, Chilean paper argues
Monetary expectations in major eurozone economies are responsive to contractionary shocks but not expansionary ones, a paper published by the Chilean central bank argues
ECB article examines lack of real convergence in eurozone
Article in latest bulletin points to three factors behind the lack of sustainable real convergence among the countries in eurozone since the creation of the monetary union
Cypriot governor warns of challenge posed by NPLs
Chrystalla Georghadji says the high level of non-performing loans is ‘perhaps the greatest challenge’ facing the banking sector, adding the central bank is ready to focus on dealing with them