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For example, in Germany, interest rates on all instruments from overnight loans to 30-year government bonds temporarily became negative, and in Switzerland, interest rates on all instruments up to 50-year government bonds were negative at one point. | In the United States, yields on 10-year Treasuries have fallen close to the lowest levels marked after the global financial crisis; market participants seem to have various interpretations of the implication of an inverted yield curve, which has been observed since mid-August, with yields on 10-year Treasuries declining below those on 2-year Treasuries. | 1 |
The groups that have emerged have improved their profitability by expanding asset management business and reducing staff. It is now necessary for the leading groups to strengthen their organizational structures and make the improvements competition demands. | Huang Yong (Ambassador of the Peoples Republic of China) Mr Vishnu Mohan (ANZ Bank, Chief Executive Officer Pacific & Fiji) Mr Li-Gang Liu (ANZ Chief Economist, Greater China) Distinguished Guests Management and Staff of ANZ Bank Ladies and Gentlemen Good evening and a belated Gong Xi Fai Chai (Happy Chinese New Year). | 0 |
In your building, at the ECB, when one thinks about France, does one say that France is the sick man of Europe? Well, frankly, I must say I hate this expression of the sick man of Europe. We all need a strong France. We need a competitive France and we need a France where competition lives together with solidarity. Europe needs a strong France. | I commend them for the role they have played and hope that they will continue to do so in future with utmost efficiency and fairness. 2. The forex market is unique in several ways. A foreign currency is essentially a commodity outside its jurisdiction and therefore has attributes of an asset. | 0 |
By referring to some specific data, let me briefly explain how the intended effects have been spreading so far. Yields on 10-year JGBs already had been lowered to a record low level before the Bank decided to introduce “QQE with a Negative Interest Rate,” and thus the entire yield curve has been pushed down to an extremely low level (Chart 9). | At the same time, inflation expectations have been rising on the whole from a somewhat longer-term perspective. According to various survey-based indicators, inflation expectations generally have been raised by about 0.5 percentage point under QQE (Chart 10). The decline in the nominal interest rate and the rise in inflation expectations suggest that the real interest rate has been largely pushed down. | 1 |
V summarizes the features of the payment system that determine how much money is needed to carry out a given volume of transactions. Fisher assumed V was constant and that in the long run Q would be determined by the economy’s productive capacity and be independent of the money supply. | In the face of ongoing financial innovations, V is not constant, and the link between money and prices, even in the long run, is not as precise. 6 In a strict gold standard, there is not opportunity for discretionary monetary policy. | 1 |
To date, despite a current account deficit exceeding 6 percent of our gross domestic product (GDP), we--or more exactly, the economic entities that comprise the U.S. economy--are experiencing few difficulties in attracting the foreign saving required to finance it, as evidenced by the recent upward pressure on the dollar. | Mark W Olson: Update on the US economy and fiscal outlook Speech by Mr Mark W Olson, Member of the Board of Governors of the US Federal Reserve System, at the Fraser Institute Roundtable Luncheon, Vancouver, 12 October 2005. * * * Thank you for inviting me to speak to you today. | 0 |
5 See Robert DeYoung, Dennis Glennon, Peter Nigro, and Kenneth Spong (2012), “Small Business Lending and Social Capital: Are Rural Relationships Different? (PDF)” University of Kansas Center for Banking Excellence Research Paper #2012–1, June. | The OECD is by far the most valuable repository of knowledge on grass root experiments in financial literacy. Learning from these international best practices can certainly help India to “leapfrog” BIS Review 41/2010 1 over several stages of the process. Partnering with OECD is therefore a huge and valuable learning opportunity for India. Why is financial literacy important? 5. | 0 |
The one most people would think likely to have a differential impact across regions would be the big rise in mining prices and associated buildup in investment that we saw a few years ago, and which has returned over the past year and a half. | Van Reenen, “ The Fall of the Labor Share and the Rise of Superstar Firms,” National Bureau of Economic Research Working Paper No. 23396 (May 2017); and S. Barkai, “Declining Labor and Capital Shares,” Job Market Paper, University of Chicago (2017). 10 See J. | 0 |
Starting from the late 1980s Stefano Fenoaltea actively participated in the work on the research project that Carlo Azeglio Ciampi promoted for the centenary of the Institute in 1993, with Pierluigi Ciocca as a mentor and Franco Cotula as Head of the newly created Historical Research Office. | These studies were published in the Historical Series of the Bank of Italy and can now all be accessed online on the Bank’s website. | 1 |
The Role of the state Ten or even five years ago, the opinion in the academic world was relatively unanimous with respect to the role of the state in the banking sector: The state and regulators were seen as an obstacle to economic growth, and state-owned banks were perceived as the flotsam and jetsam of free market economies. | “Let the market deal with the issues of the financial sector, and capital and risks will be efficiently allocated,” most academics argued. A saying attributed to the well-respected former Bavarian prime minister Franz-Josef Strauss comes to mind: “A dog is more likely to put away a sausage for a rainy day than the state is to save money.” Then came the financial crisis. | 1 |
However, if a sovereign has completed a three-year programme but still finds itself locked out of the market and must therefore be presumed to be trapped in a state of deep insolvency, bonds issued on the market would be restructured so as to restore that government’s long-term solvency. | 4 In implementing a same-risk-same-regulatory-outcome principle, we should start by ensuring basic protections are in place for consumers and investors. Retail users should be protected against exploitation, undisclosed conflicts of interest, and market manipulation—risks to which they are particularly vulnerable, according to a host of research. 5 If investors lack these basic protections, these markets will be vulnerable to runs. | 0 |
In these circumstances, the right approach, ultimately, may be to move toward directly pricing the services we obtain from our computers -- that is, word processing services, database management services, and so on -- rather than pricing separately the hardware and software. | In order to generate growth and reduce unemployment, continued efforts to consolidate public finances should be accompanied by determined structural reforms, thereby promoting a mutually reinforcing process between restored fiscal sustainability, financial market access and future economic growth prospects. The structural reforms should be ambitious, broad-ranging and with long-lasting effects. | 0 |
To reap the fruits of global economic growth, it is essential for public authorities and private firms to strive to actively participate and take the initiative in such moves. In the financial field also, discussions are underway toward revising global financial regulations to reflect the lessons learned from the recent crisis. | The Bank of Japan is also actively taking part in this process, through the G20 meetings and various venues for international discussion. The fourth challenge is to develop various safety nets. In order for the economy to grow in a sustainable manner, it is essential to have sustainable expansion of private consumption. | 1 |
The tremendous benefits that are associated with this integration process in terms of rising living standards and overall prosperity should not be taken for granted though since globalisation and rising capital mobility require taking into account the possibility of shocks spilling over into different countries. | The financial crises that we have witnessed over the last 25 years and that were largely confined to emerging market and developing countries have not been few: The debt crises during the 1980s that started with Poland and Mexico and spread to Latin America, Africa, the Middle East and the Soviet Union; some years later, the Mexican crisis in 1994; the Asian crisis starting in 1997; the Russian crisis in 1998; and the Argentinian crisis in 2001-02. | 1 |
The same is also true of my medium-term relatively cautious forecasts, which have been consistently lower than the median for both real GDP growth and core CPI inflation since the introduction of QQE in April 2013. It is natural for a central bank to revise its forecasts given changes in assumptions with respect to domestic and external conditions. | Nevertheless, since the revisions have been large, I feel it necessary to provide a clear explanation for these developments. Thus, I will provide my views in this area in the following sections. B. | 1 |
Apart from having all their eggs in one basket, this also has implications for the level of gearing taken on by the household sector and the manner in which New Zealand’s debt is funded. It has also meant that not much local equity is available for New Zealand business. | The gap has been filled by foreign equity, which brings many development advantages for large businesses, but which is less conducive to supporting startups and other small businesses. It has also left the economy more vulnerable. The Reserve Bank has the dual roles of promoting stability in prices and promoting stability in the financial system, to enhance economic performance. | 1 |
One of the terms of reference of this Committee is to study the Quality Assurance Procedures and functions relating to data within the European Central Bank (ECB) and analyse its possible emulation at the RBI. 16. In the ECB, a special effort was made to maximise the use of standardised concepts, data structures that are already in existence. | This is expected to lower the costs, including the costs to partner institutions, and promote European and international interoperability, as well as greater accessibility of the statistics. 17. | 1 |
First, like many other industrial countries, the United States has entered what is likely to be a long period of 1 According to the latest estimates of the Bureau of Economic Analysis (BEA), real GDP growth was 3.2 percent in 2005 and 3.4 percent in 2006, both figures stated on an annual-average basis. | This is an opportunity for EU market stakeholders to shape the work on open banking and to demonstrate that we are able to progress towards that objective – in a coordinated way, for the good of European citizens. Banks should not see third-party access to accounts as a threat. | 0 |
Indeed, our current account balance can be shown to be exactly equal to the difference between domestic saving and domestic investment. In fact, it is often instructive in longer-term analysis to view our current account in terms of its domestic counterparts. | As I pointed out in a speech last November,3 virtually all of our trading partners share our inclination to invest a disproportionate percentage of domestic savings in domestic capital assets, irrespective of their differential rates of return. People seem to prefer to invest in familiar local businesses even where currency and country risks do not exist. | 1 |
In particular, financial sanctions that were due to be applied for cases of persistent failure to correct excessive deficits were never applied. Apart from the weak fiscal surveillance mechanisms, the economic governance framework also failed to prevent the emergence of large and persistent macroeconomic imbalances. Some Member States experienced inflation rates permanently above the euro area average. | In these countries, increases in wage costs, significantly exceeded productivity gains and this, in turn, led to a substantial rise in unit labour costs. As a consequence, competitiveness was gradually eroded and risks of adverse spill-over effects from individual countries to the euro area as a whole emerged. | 1 |
Aren’t you concerned about the ECB having conflicting objectives? That is a crucial issue and it also featured very prominently in the debate on supervisory reform in Germany. We need a clear separation between supervision and monetary policy to ensure that there are no points of conflict with central bank independence and the objective of price stability. | 2 Household spending advanced moderately in the second half of last year, boosted by a fourth-quarter surge in motor vehicle purchases that was facilitated by an easing of constraints on supply related to the earthquake in Japan. | 0 |
Moreover, while there may be limits to how much households can bring forward future income in response to lower borrowing costs, governments can in principle raise their future income through their spending today. This is the case if government spending raises productivity and thereby future potential output, which increases fiscal space today. [43] Higher expected growth in turn makes private sector transmission more effective. | This is not about policy coordination. Our framework in the euro area is built on monetary dominance, where the central bank decides its policy independently based on price stability considerations alone. Rather, if governments want to see a faster exit from unconventional policies, it is in their interests to align with monetary policy. But this is not what we have seen up to now. | 1 |
Operational restructuring, an on-going process, includes improvements in efficiency and management, reductions in staff and wages, sales of assets (for example, reduction in subsidiaries), enhanced marketing efforts, and so on, with the expectation of higher profitability and cash flow”. Unquote. 2 BIS central bankers’ speeches 8. | 8 The decline in the unemployment rate in recent years has been accompanied by a pronounced increase in labor force participation for individuals in their prime working years. 9 These increases in prime-age participation have provided employers with a source of additional labor input and have been one factor restraining inflationary pressures. | 0 |
One must focus first on internal testing and the isolation of a test environment to avoid contamination with the current production environment. | Our message to those who launder money or finance terrorism must be clear, consistent and strong: crime does not pay. I wish you fruitful discussions. Thank you. BIS Review 4/2010 3 | 0 |
Conclusion The pandemic constitutes a multi-phase challenge for monetary policy. In the initial weeks of the pandemic in spring 2020, the top priority was clearly to stabilise markets. | At the same time, changes in technology have lead to the creation of new financial products and services to automated teller machines to customer credit checks at the teller and to some the development of e-banking. These changing financial industry dynamics have facilitated a growing trend towards increased efficiencies but have entailed major capital outlays. | 0 |
At best, we can help market participants to understand how we will make decisions about the policy fundamentals that the FOMC controls – the path of future short-term policy rates and the total stock of long-term securities that we ultimately plan to accumulate via our asset purchases. | I am pleased to be here to answer your questions about today’s interest rate announcement and our Monetary Policy Report (MPR). Before taking your questions, let me offer a short summary of Governing Council’s deliberations. A lot has happened since our last MPR in October. For one thing, the US-led trade war is beginning to have negative economic consequences. | 0 |
But there are other barriers holding back bank lending, like heightened risk aversion, a lack of loan demand and insufficient capital. And above all, bank lending will only fully come back when the bank balance sheet repair is completed in all member states. The ECB cannot remove these constraints. This is where our responsibility ends and that of governments or other EU institutions begins. | Monetary policy is not an all-purpose weapon for any kind of economic illness. How can we overcome the political challenges to adjustment? Some of you might react to this that governments are already being asked to do too much. That the costs of adjustment are too high in some countries, and at some point, people will simply not take anymore. | 1 |
4 -8Looking Back and Taking Stock Although we continue to closely monitor the path of the virus and the public response to it, economic and financial conditions have improved much more than many had expected in the spring. | Finally, I regard it as important that in the future such a framework does not apply only to large, internationally active banks, but would universally cover all banks that are operating in the euro area. This would be important to establish a level playing field between different types of banks and banking activities, and leave as little room as possible for regulatory arbitrage. | 0 |
This provides reassurance that the adjustment in our housing market is not a financial stability issue. We have not experienced the very loose lending practices that were common in the United States before the housing crash there a decade ago. Nor have we seen significant overbuilding around the country. | For that reason, the Bank cannot, and should not, comment on every piece of new economic data or information that becomes public. But by transmitting our view of the larger trends in the economy, the Bank can promote better anticipation of the direction of policy. | 0 |
Jean-Claude Trichet: Macro-prudential supervision in Europe Text of The Economist’s 2nd City Lecture by Mr Jean-Claude Trichet, President of the European Central Bank, London, 11 December 2009. * * * Ladies and Gentlemen, I am very pleased to be in London today and would like to thank The Economist for the opportunity to deliver this City Lecture. | As regards the topic, I thought that this would be an opportunity to reflect on the future macro-prudential supervision in Europe. We are gradually beginning to see beyond the current crisis and consider ways to strengthen the resilience of the financial system. This is a project to which macro-prudential oversight can make an important contribution. | 1 |
Strengthening sustainability The fiscal challenges that Greece is facing today, while more severe than others, are not unique to this country. All Western societies are being confronted with difficult questions about the distribution of consolidation and spending between current and future generations. A first question is how the burden of high public debt levels in Western societies will be shared between generations. | It’s not simply a matter of having access to as many product types, but how one maximizes that privilege to serve his public best. In the context of our financial infrastructure, we have commercial banks, thrift banks, rural banks, and cooperative banks. We have do-it-all institutions like universal banks. | 0 |
As governments have had to consolidate their fiscal positions, there has been an unprecedented onus on monetary policy to support aggregate demand. The ECB has responded to this challenge and acted decisively to secure price stability in face of an economic and financial crisis unparalleled in post-war history. | But this role, and the unconventional measures we have adopted to execute it, has inevitably put monetary policy more in the spotlight. We are facing intense scrutiny as to how our policy works, its necessity and the side effects it causes. | 1 |
The inflation-targeting framework was untested and there was little in the way of academic analysis to provide guidance about the general design and operational principles. Practice was very much ahead of theory. Now 25 years later, inflation targeting is widely used as the framework for monetary policy. | While there are differences in some of the features across countries, the similarities are more pervasive than the differences. And generally, the features of inflation-targeting frameworks have tended to converge over time. It is interesting to firstly examine how the inflation-targeting framework in Australia has evolved over the 25 years. Secondly, it is also timely to reassess the appropriateness of the regime. | 1 |
* * * Distinguished Guests Chief Executive Officers of Primary Dealer Banks Members of the press Ladies and Gentlemen Good Morning, It is my great pleasure to welcome you all to this ceremony, which is organized to recognize the best performing Primary Dealer in Uganda Government Securities for the year 2011 – the 7th Annual Primary Dealer Award Ceremony. | In February 2003, The Bank of Uganda introduced the primary dealer system. The main objectives were to: (i) Promote financial markets development. (ii) Stimulate and broaden the government securities market through increased competition. As you all know, Primary dealers serve as trading counterparties of the Bank of Uganda in its implementation of monetary policy. | 1 |
2 BIS Review 129/2007 Let me talk first about hedge funds, which have come to play a major role in financial markets. Assets under their management have more than tripled over the past six years. They increased from USD 539 billion in 2001 to USD 1,810 billion at the end of the third quarter of 2007. | I am happy to be here in Kansas City for the 13th of 14 Fed Listens events. I look forward to hearing the perspectives of the community and business leaders participating today. The Reserve Banks and the Board have been holding Fed Listens events around the country as part of a comprehensive and public review of our monetary policy strategy, tools, and communications practices. | 0 |
Until not so long ago our payment system was highly integrated with that of South Africa. In fact Namibia dependent heavily on South Africa’s payment system infrastructures for clearing and settlements of most of the payment system instruments e.g. cards and ATMs. | This dependency made the country vulnerable to risks that would affect the payment system in South Africa and placed the oversight of critical payment system infrastructures outside the jurisdiction of Namibia. It is against this background that reforms were initiated. | 1 |
This would also lead to greater accounting volatility, for the following reasons: • 2 Going forward all life insurance liabilities and non-life (property and casualty) claims liabilities would have to be discounted either via a bottom up approach BIS central bankers’ speeches (risk free + liquidity premium...) or a top down approach (starting from assets return). | The discount rate would have to be adjusted regularly, namely at the end of each reporting period. In the IASB’s tentative approach, the effect of changes in the discount rate must to be posted in P&L at each reporting date. | 1 |
The European sovereign debt crisis and consequent deleveraging by the European banks has increased funding pressures for our entities as the European banks are an important source of finance for Indian banks and corporates. | In the recent period, Indian corporates have expanded abroad and, given the volatility in financial conditions the world over, their exposures by way of equity, loans and contingent liabilities like guarantees to the JV/WOS set up in stressed countries abroad could put pressure on the parent companies who maybe required to provide support to their overseas JVs/WoS. | 1 |
Emergency liquidity assistance can be provided by national central banks on the basis of their national competences and to pursue national objectives, namely to preserve financial stability when a solvent entity is facing temporary liquidity issues. The provision of ELA must likewise be backed by sufficient collateral. | Many countries rely on self-regulation because expansive resources are required to regulate the financial markets effectively, especially in large and complex markets. With the existence of an effective SRO, often referred to as frontline regulator, the statutory regulator (the Regulator) relies on the SRO to carry out supervision of operations and activities of the market participants. | 0 |
If firms expect higher income, it improves their debt-to-income ratios and debt service capacity, which in turn creates space for new investment.15 In this sense, raising both the level and trend of potential growth is an integral part of recapitalising European firms, and indeed of the economy as whole. | 12 For more information see article on “Deleveraging patterns in the euro area corporate sector”, ECB Monthly Bulletin, February 2014. 13 See opinion piece by Benoît Cœuré and Jörg Asmussen, “A three-pillar-strategy for the euro”, published in Berliner Zeitung and Les Echos, 19 September 2014. | 1 |
The UN has recognised this potential and brought together a group of the world’s largest pension funds and insurers.4 The group is called the “Net-Zero Asset Owner Alliance”, and is responsible for investments worth more than $ trillion. The institutions within the group have committed to transitioning to carbon-neutral investment portfolios by 2050. | BIS central bankers’ speeches 1 The Report’s section on crisis containment includes an assessment of the 29 September 2008 decision to guarantee substantially all of the liabilities of the banks. | 0 |
Progress has been made on this front, but further improvement is needed to enhance the quality and completeness of customer information, to ensure that the contractual terms as advertised correspond fully with those actually applied, and to prevent improper charges being levied on customers. | The Bank of Italy has drawn up clear rules, compliance with which it verifies also by means of special inspections, imposing fines when irregularities are detected. For several years now, for individual disputes there is the Banking and Financial Ombudsman, acting through three territorial panels and independently of the Bank of Italy. It has proved to be effective and highly regarded. | 1 |
Mandatory versus voluntary 9. In most parts of the world, NFR remains a voluntary practice. So far, France is the only country to enact specific legislation requiring publicly listed companies to produce nonfinancial reports covering economic, social as well as environmental dimensions. Various other countries mandate detailed reporting for specific industry sectors. | Additionally, some stock exchanges like the South African Stock Exchange now make NFR a requirement for listed companies. | 1 |
As a result of this decision, euro area counterparties will be able to borrow as much USD liquidity as they wish, also at some term maturities, against eligible euro-denominated collateral, with the supply of USD guaranteed by an unlimited temporary reciprocal currency arrangement between the Federal Reserve and the ECB that will remain in place for as long as needed. | On 15 October the Eurosystem also entered into an agreement with the Swiss National Bank in order to facilitate the provision of liquidity denominated in Swiss Francs to euro banks. | 1 |
Apart from concrete bank-specific findings, the reviews have helped us to get a better idea of the risks. And they have made banks more aware of them. We have conducted a stocktake on how IT risks are supervised outside the euro area. This helped us to identify best practices; and it will help us to define our own supervisory expectations. | When the financial crisis broke out in 2007, the vulnerabilities were laid bare: investor sentiment began to shift, and interest rates for the countries in question started to rise sharply, triggering a crisis that is still far from being fully resolved. In order to understand the onset of the crisis, it is useful to remind ourselves of the euro area’s unique institutional set-up. | 0 |
I am pleased to participate in the Board’s conference on credit risk and credit derivatives. Song Han, Matt Pritsker, and Hao Zhou have worked hard to put together a stimulating program of cutting-edge research in this area. | 7 Most commonly, shock propagation within the financial system is thought to occur via interbank networks or via 1 See IMF (2010) “The IMF-FSB Early Warning Exercise: Design and Methodologies Toolkit”, September. 2 See e.g. Borio, C. and P. Lowe (2002), “Asset prices, financial and monetary stability: Exploring the nexus”, BIS Working Paper No. | 0 |
And with market function improved and containment restrictions easing, the Bank’s focus will shift to supporting the resumption of growth in output and employment. The July Monetary Policy Report will provide our updated assessment of the outlook for output and inflation. | And we should not forget that BigTech firms are the ones running platformbased digital ecosystems into which payment services are increasingly being integrated as an integral component. It was against this backdrop that what was known as “Facebook coin” was formally announced in June 2019. | 0 |
In this context, banks had no option but to embark on a deleveraging BIS central bankers’ speeches 1 process towards a more sustainable funding structure – a funding structure that would be less sensitive to changes in the risk perceptions of international investors. | Deleveraging has been continuously monitored by Banco de Portugal so as to ensure that it takes place in an orderly and gradual manner. We have emphasised that deleveraging strategies should concentrate on the sale of non-strategic assets, on increasing recourse to stable funding (notably in the form of customer resources) and on capital increases. | 1 |
While euro-area monetary policy causes alterations in many parts of the economy, its mandate also prescribes clear responsibilities – price stability is an overarching goal. Rather, the transformed landscape urges banks to concentrate on their own responsibilities. Banks still play an important role in the market economy. Nevertheless, they are also part of it. | In practice, all 5 Blinder has formulated a “Law of Speculative Markets: the markets normally get the sign right, but exaggerate the magnitude by a factor between three and ten” (Blinder, 1997). 6 On “go-stop” monetary policy, see Goodfriend (1997) and the references cited therein. | 0 |
For corporate bonds that’s true of both investment grade and non-investment grade debt (Graph 1). In short, demand for fixed income securities is strong. 1 / 15 BIS central bankers' speeches Why might that be? One contributing factor has been the improvement in global economic conditions. This is supporting business profits, which helps to reduce actual and prospective defaults. | Let me note at the outset that this is not the consolidated capital framework we apply to bank holding companies. | 0 |
those with positive turnover in the last six months seeking a bank loan – varies from a minimum of 1% in Germany and Austria to a quarter of the total population in Spain and as much as a third in Portugal. Importantly, credit weakness appears to be contributing to economic weakness in stressed countries. | To show this, one can undertake a quantitative exercise to compute “normal credit”, similar to the notion of potential output. The difference between the actual volume of credit and normal credit offers a measure of the “credit gap”, analogous to the output gap. | 1 |
Recently, significant new investments have been noted in the aviation, tourism, mining and financial services sectors while the Government has embarked on massive public infrastructure projects in roads, ports and bridges. Our garments and manufacturing sectors are also showing much greater confidence with higher investments this year and more envisaged. | [5] That is a fundamental force in the housing market that always needs to be kept in mind. How many people live in each dwelling can change, but that is generally slow moving. It is affected by social forces that influence average household size as well as economic forces like prices, rents and income. | 0 |
But it is important to understand that this expansion need not trigger inflation now or in the future, because the Federal Reserve can now pay interest on bank reserves. Going forward I’ve spent most of this speech looking back. Let me close by offering some thoughts about future policy. | We believe that this direct intervention will be key to influencing changes in personal financial management and we therefore hope to utilise this medium extensively. We have identified several groups that can possibly benefit from these presentations. However, if you have a group or know of one that might be interested, please contact the Bank. We will seek to accommodate you where ever possible. | 0 |
Banks’ long-standing ties with their private clients allow them to glean information about firms and managers. This information allows banks to allocate capital more efficiently than other intermediaries who lack such information. In the process, banks create value for the economy as a whole. | However, banks do not have such privileged information on the debt of a nation – especially on the debt of central governments. It makes sense for banks to hold a certain amount of sovereign debt for liquidity purposes. But there is no reason why the financing of governments should not be more of a matter for the capital markets. | 1 |
6 The IMF’s April 2023 World Economic Outlook forecasts world output at 2.8% this year, down from 3.4% in 2022. It forecasts South Africa’s growth at 0.1% this year (compared with 2.0% in 2022 and a projection of 1.8% for 2024). so years.7 Together with increased alternative energy imports, this means that our terms of trade will deteriorate further. | Following the robust growth rate of 4.9% recorded in 2021, the domestic economy slowed sharply to 2.0% in 2022. The SARB now forecasts growth of 0.2% this year, and to average 1.0% in the following two years – this is barely an expansion. In fact, this is a reflection of the headwinds that the domestic economy continues to face. | 1 |
New or changed regulations have to be evaluated and relevant internal policies appropriately modified. This can entail training for both the line and compliance staff. The frequency and extent of compliance reviews and testing should be consistent with the nature and complexity of the institution's compliance risks. | Thank you to President Evans for inviting me to speak here today about the role of boards of directors of large banking firms.1 Ten years ago this month, the world witnessed the first tremors of what we now think of as the Global Financial Crisis and the subsequent Great Recession. | 0 |
I knew as a kid, however, that in order to buy a ticket to go to the movies with my friends, I was going to have to number around 400 pages, and if I did more pages than that and invested the money in a savings account at a bank at a compounded annual interest rate of 4-1/2 percent, I could eventually afford to buy some popcorn, too. | Or take a brief vacation from numbering. But if I wanted to cut back the number of pages and still accumulate enough to go to the movies sometime, I would need to find an interest rate out there for my earnings of three or more times what the bank was offering – not likely for a very young investor with limited funds. | 1 |
This is also due to an attempt by firms to recoup at least part of the pay rises paid in 2013-15 over and above observed inflation. 5 included automatic ex-post wage indexation. In other cases the renewal of expired agreements was postponed. | As a result, less than a fifth of the labour contracts in force at the end of 2016 included expected inflation among the parameters for calculating pay rises. Thus, the data indicate that labour is still a widely underutilized factor of production and that inflation expectations reflect the deflationary shocks of recent years. These are cyclical problems, not structural ones. 4. | 1 |
For example, the recent structural reform efforts in México have opened up certain sectors that were previously closed off to foreign investors, such as the oil and electricity sectors. | You can trust neither your subordinates nor your superiors. Errors can be expensive. Correct your errors. If you do not do so, your errors become fatal mistakes in treasury management. The events of the past two years demonstrate how quickly a corporation’s reputation can be tainted by accusations of inappropriate activities or lack of attention to regulations. | 0 |
Second, we must be cautious in assuming that more diversified and larger firms are inherently less risky. One of the ongoing challenges in the emerging world of high tech finance is risk management. | The experiences of the last 2.5 years indicate that the speed of market movements, combined with the scale of financial endeavor, can lead to a rapid reversal of fortune for even the most sophisticated market participants. Models are inherently backward-looking, and even the best of them have not proven to be foolproof in sounding the alarm for newer risks. | 1 |
In my remarks this morning, I will argue that the rebound in trade mainly reflects cyclical factors. Accommodative monetary policies worldwide have succeeded in boosting growth and investment and, with them, global imports. Structural headwinds remain, however. | I would now like to say a word about an issue that this Committee has raised recently – the renewal of the Bank’s inflation-control agreement with the Government of Canada. This is central to the Bank’s mission and we appreciate the Committee’s interest in it. Since 1991, inflation targeting has proven its worth in both tranquil and turbulent times. | 0 |
This explains why the number of new ratings provided by ratings agencies to borrowers located in the euro 3 BIS Review 54/2000 area increased very substantially in the course of 1999, also for borrowers with ratings somewhat below the best levels. | Second, with the creation of the euro, investors and borrowers active in the financial markets of the euro area have de facto been granted access to the euro-denominated market. This market, even if it is not yet fully integrated at the area-wide level, is larger and more open than any of the markets denominated in the predecessor currencies of the euro. | 1 |
2 BIS central bankers’ speeches This, in my view, is the main area of reflections where a vision for the role of monetary policy in a changing financial landscape should take shape. In fact, how a central bank deals with structural balance sheet imbalances is not a problem confined to the management of recessions. | It is a key element of a strategy for handling the business cycle in its entirety. So, it lies at the very heart of monetary policy. But it is an exceptionally difficult problem to solve. It is fraught with a cluster of ancillary questions. Let me list some of these. | 1 |
Who has not had the experience of realizing that the person on the phone helping with a problem with software or a credit card lives in another country? | In order to have a balanced external account and address the problem of excess supply, we need to intensify structural readjustment, and pay attention to risks of unemployment and the quality of bank assets. Structural readjustment will bring strong pressure on employment. The reemployment of laidoff workers will draw popular attention. | 0 |
Second, the fact that households' tolerance of price rises has not been increasing clearly has been constraining a rise in inflation. According to the Bank's survey, following the introduction of quantitative and qualitative monetary easing (QQE) in 2013, the level of households' tolerance of price rises shifted upward in a favorable direction compared to past levels. | However, the level has not risen further (Chart 5). This is likely to be attributable to the first reason mentioned earlier -- that is, it has been taking time for wage increases to fully take hold. Third, firms' cautious price-setting stance also has been constraining a rise in inflation. | 1 |
In such an environment, differing interest rate levels are needed to maintain price stability in the global economy. Given their higher rates of inflation, higher interest rate levels would be required in emerging markets. | Assuming that authorities will face increasing difficulties in limiting capital inflows by administrative measures and changes in minimum reserve requirements, interest rate differentials can be achieved only with emerging markets adopting more flexible exchange rates. To a European observer the two opposing forces I have just described are quite familiar. | 1 |
Particularly in the past decade, we have found that the increased range of products and the greater depth and liquidity of financial markets permit banking organizations to change their risk profiles more rapidly than ever before. | That possibility requires that we strike an appropriate balance between evaluating the condition of an institution at a point in time and evaluating the soundness of the bank’s processes for managing risk. Recognition of the need for that balance is at the heart of the risk-focused examination approach. | 1 |
Fourth, I will briefly discuss monetary challenges faced by emerging economies in the current context of the extraordinarily accommodative monetary stances of advanced nations. And finally, I will draw some conclusions. As usual, my remarks are entirely my own and do not necessarily reflect the views of the Bank of Mexico or its Governing Board. What positive impacts can monetary policy have? | Over the last hundred days, we have seen the horrendous daily spectacle of indefensible aggression and war play out before our very eyes. | 0 |
We have adopted a structured, planned and integrated approach towards Financial Inclusion which is focusing on improving access to financial services and also encouraging demand for financial services through Financial Literacy initiatives. | In the circumstances, they also fail to acknowledge that high premiums are driven by the high cost of claims. The Central Bank has no role in setting or capping premiums or renewal rates, as that is strictly prohibited under EU law. Put simply, regulators cannot intervene on the level of premiums. | 0 |
Participants included ministers of finance, governors of central banks and senior officials from finance ministries, central banks and regulatory authorities from various countries in Africa as well as members of the FSF. In June 2005 the Bank participated in workshops on a SADC cross-border settlement model. | The Bank, in conjunction with other central banks in the SADC region, is investigating options to facilitate the settlement of cross-border payments within the region. The Bank contributed significantly to the development and deployment of the Bank Supervision Application solution, a computerised system which was developed on behalf of SADC and some East African countries. | 1 |
The most distant futures prices fell from a bit more than $ per barrel just before the Gulf War to $ to $ a barrel a year ago. The current six-year futures contract has risen, on net, over the past year and has been a little above $ per barrel in recent days. | Arguably, however, this rise is related less to technology and the structure of underlying marginal costs and more to uncertainties about how quickly the new practices will be exploited to expand OPEC's productive capacity. Going forward, there is concern that OPEC may choose not to expand capacity adequately from their large proven reserves. | 1 |
Overall economic growth in the last decade or so, coupled with higher disposable incomes have led to an exponential growth in retail spending. As the efforts directed towards financial inclusion take off, the bankable population will see further rise. This would require that delinquency risks and quality of portfolio are carefully managed by banks. | Adherence to the provisioning requirement, building countercyclical provisions and holding countercyclical capital buffers in good times can, to some extent, insulate banks from excessive default stress during crisis situations. (ii) Consolidation 34. Mergers and acquisitions (M&A) as a means of inorganic growth are increasingly being used the world over to undertake restructuring of leading business enterprises. | 1 |
I suspect that innovations in payments systems are quite likely to have far-reaching effects, including the growth of what might be termed the “shadow payment system” at the retail level. Here, by the way, I am departing a bit from my self-limitation to prudential issues, since consumer protection issues around alternative payments systems may be quite significant. | As you know, in making our policy decisions, my FOMC colleagues and I spend considerable time assessing the incoming economic and financial information and its implications for the economic outlook. But we must also consider some other issues, two of which I would like to mention briefly today. First, most estimates of the full employment rate of unemployment are close to 5 percent. | 0 |
4 Against a backdrop of declining reserves and high levels of Treasury securities outstanding, in mid-September 2019, imbalances in the supply of and demand for short-term funding led to pressures in the repurchase agreement (repo) market. | Second, we need to swiftly implement in EU law the aforementioned BCBS standard for the prudential treatment of crypto-asset exposures. We need to be ambitious and make rapid progress, in particular on the envisaged exposure limit to reduce contagion between crypto and banks. | 0 |
Its size, including investment funds, money market funds and special purpose vehicles with links to credit intermediation, was just over € trillion in Ireland at end-2015. Non-bank intermediaries assist financial development and economic growth, through intermediation, risk diversification and promoting market efficiencies. Increasingly, non-bank alternatives are competing with banks, requiring the latter to adapt their business models. | My colleagues on the FOMC and I expect the economy to continue to expand at a moderate 1/3 BIS central bankers' speeches pace, with the job market strengthening somewhat further and inflation gradually rising to 2 percent. | 0 |
However, this strategy would also exacerbate the negative output effects of the shock itself. Another approach – the one adopted by the Reserve Bank – is to look through the first-round direct impacts of oil prices on CPI inflation (via retail petrol prices), but to respond to the risk of more generalised inflation pressures arising from the shock, such as rising inflation expectations. | CCPs 3 Gorton (2010), “Questions and Answers about the Financial Crisis”, paper prepared for the U.S. Financial Crisis Inquiry Commission, February and Gorton, G. (2010), “E-coli, Repo Madness, and the Financial Crisis”, Business Economics, Vol. 45, No 3, pp. 164–173. 4 See International Capital Market Association (2012), European repo market survey, No 22, September. | 0 |
The estimated amount of euro banknotes circulating outside the euro area at the end of June accounts for only 8% of total currency in circulation and only 0.4% of the monetary aggregate M3. Therefore, while the ECB monitors these developments closely, they currently play no significant role in the assessment of monetary developments in the euro area with regard to price developments. | Demand for euro banknotes over the longer term Let me also take a somewhat longer-term perspective with regard to the demand for the euro in the euro area and outside. | 1 |
This will enable us to clarify the regulatory perimeter and assist in efficient resolution, should the need arise, without having recourse to taxpayers’ money. In the same vein, we have encouraged branches of foreign banks operating in Mauritius to convert into locally-incorporated subsidiaries that would give us more effective control and greater ability to act independently in conditions of stress. | At the same time, we must remain aware that we, central bankers, are not elected officials, but are assigned with a task – price stability – that is fundamental to the wellbeing of our citizens. This requires that we can be held accountable for our actions, and act transparently at all times. | 0 |
The problem is not the existence of current account deficits or surpluses per se, but it is persistence of large current account deficit and large current account surplus, particularly in large and systemically important economies, which give rise to fears of unsustainabilty and disruptive unwinding. | (b) Possible causes of global imbalances The current global imbalance is reflected in large mismatches in the current account positions in some countries and its mirror image in the form of domestic saving-investment mismatches. For instance, the US current account deficit was 6.4 per cent of GDP in 2005 and stood at US $ billion. | 1 |
This scenario is not a pipe dream. In many parts of emerging Asia, consumer demand is picking up. From Myondong in Seoul to Nanjin Lu in Shanghai to Siam Square in Bangkok, consumers are flocking to fashionable shops and cafes. This demand is creating a favorable cycle by creating new jobs and hence greater consumer demand. | For this model to work, however, a thorough understanding of the region and the needs of the people is essential. The deepening of regional integration will, I hope, give birth to a new breed of intra-regional investors, who will focus on these opportunities. In connection with this scenario, an interesting question is how to finance the efforts of the region’s entrepreneurs. | 1 |
But that isn’t going to work in the long term.” The dialogue between member states has also taken on a harsher tone at times. But monetary union was actually a project intended to encourage European integration and ultimately even bring about deeper international friendship. | This projection which, in my view is on the low side, means that in the five years 2009 to 2013 average GDP growth will be 9%. There is no question that it is one of the highest growth rates in the world. We can without hesitation define Papua New Guinea as a Very High Growth, Small Emerging Market Economy. | 0 |
The Special Program consists of two temporary measures to support financing, mainly of firms: an operation through which the Bank provides funds on favorable terms to financial institutions that make loans in response to COVID-19 and a substantial increase in purchases of CP and corporate bonds. | – We need to share our vast experiences and to speak about what each one can do or offer to develop our countries. | 0 |
I will then discuss the prospects of the Greek economy and the pre-conditions that need to be met to achieve sustainable growth. Finally, I will put forward some proposals for enhancing the EMU architecture. 1. | Brief overview and lessons from the Greek crisis At the onset of the crisis, a deterioration in the macroeconomic environment, the downgrades of sovereign debt and rising sovereign spreads on account of large macroeconomic and fiscal imbalances cut off the Greek sovereign and Greek banks from international capital and money markets. | 1 |
The ECB welcomes the fact that the EPC regards the prevention of card fraud as one of its top priorities and that it has defined measures to reduce fraud and protect payment data. | The 25 members of our Governing Council may have their differences, but we analyse, we debate, we try to build a consensus and, finally, we take a decision on which nobody has a veto. By contrast, the crisis management system in the euro area is essentially intergovernmental. This method carries a high economic cost because it’s a procrastination machine. | 0 |
Nevertheless the Bank is engaging with the National Treasury, and we are examining the effectiveness and appropriateness of what other countries are doing. | Under current exceptional circumstances, where we are experiencing considerable inflows – FDI, bonds and portfolio – we will act to alleviate some of the pressure on the exchange rate by purchasing the FDI inflows either through direct transactions or from the market. Consequently we are already working with the relevant parties to give effect to this. | 1 |
In the post-corona era, low inflation could continue for a long time as the incentive for precautionary saving increases, demand slows from accumulation of debt, and digital transformation accelerates. We will need to carry out research on how to improve the monetary policy regime, while closely monitoring the discussions among major central banks. | To be clear, this has nothing to do with land availability or governments approving enough homes. The land has been made available and the building project is already approved. The issue is how fast these projects can be completed. We hear from liaison contacts in the construction industry that delays are common. Normally, a detached home takes about six months to build. | 0 |
That brings me to the weaknesses I mentioned earlier in the institutional framework of monetary union that need to be eliminated. The original structure sketched out in the late 1980s and early 1990s looked something like this. Monetary policy was to be entrusted to an independent central bank whose main task was to safeguard price stability. | The goal has been to compel SIFIs to internalize the costs their failure would impose on society and to offset any implicit subsidy that such firms may enjoy due to market perceptions that they are too-big-to-fail. The effort to reduce the likelihood of SIFI failure has worked through several channels. | 0 |
Let me note before I begin that I won’t take a stand today on which of those approaches is better. My goal is BIS central bankers’ speeches 3 simply to initiate a policy conversation about future – indeed, possibly far-off future – monetary policy choices. The FOMC announced its 2 percent inflation target in January 2012. | Moreover, further depreciation will be counterproductive for macroeconomic management, especially because of the impact this will have on the prices of imported goods and hence on consumer price inflation. Consequently, the Bank of Uganda intends to adopt a more aggressive stance to support the exchange rate. We sold dollars yesterday to the interbank market. We are prepared to intervene again if necessary. | 0 |
In theory, there are two possible ways to restore this balance: through deeper integration, or through greater national responsibility on the part of the individual member states. The first solution would be to create a fiscal union with centralised decision-making powers. While a fiscal union would not guarantee sound fiscal policymaking, it could certainly mitigate the deficit bias of individual member states. | But let’s be honest here. A fiscal union approach is not on the cards, because it implies the delegation of sovereignty to the European level in a substantial scale. As long as there’s no willingness to transfer national sovereignty to the European level, there will be no basis for mutualising sovereign risks. | 1 |
Theory and practice Plato defined “expectations” as “the beliefs about the future” more than 2000 years ago which remains valid even today.1 Such beliefs about the future do affect the current behaviour of economic agents. Therefore, inflation expectations can be broadly defined as economic agents’ belief or views or perceptions about inflation in the future. | Background to IPSA and subsequent developments Why we regulate Going back to why IPSA was enacted, it was considered appropriate to bring New Zealand up-to-date with international standards for prudential regulation. The sector was not broken and there was a desire to avoid regulation that created a compliance mentality. | 0 |
Benigno and Rosa (2023) find limited evidence that Bitcoin prices immediately react to monetary and macroeconomic factors when looking at data since 2017. Karau (2023), however, shows that the relationship between Fed policy and Bitcoin prices has evolved over time and that Bitcoin returns respond strongly to FOMC announcements after 2020. Kyriazis et al. | In 1884, a time of great strife and mistrust between management and labor, the federal government created an agency with the mission of providing detailed and objective information on American workers. | 0 |
There was, and still is, a debate about taxing banking activity, for instance in the U.S. and Europe. Germany is assessing how to handle the social cost of future financial crises and possible government intervention. We must decide who will face the burden of future crises. | 193/2001 is another important basic investment incentive, which deals with community subsidies for: • technical facilities and infrastructure up to 70% of total costs • land purchase costs up to 70% of total costs BIS Review 46/2003 3 • land rental costs up to 70% within next 10 years to the community ownership or community disposal to the use of the developer. | 0 |
SLBC is a group of bankers and government officials and is convened by a bank having major presence in the State called the SLBC convenor bank. It meets quarterly and reviews the banking developments in the State. At the district level, the district level committee functions; it is headed by the District Commissioner and is convened by a designated lead bank for the district. | This new domain, so to speak, will have common socio economic objectives encompassing the following: • Economic Transformation • Growth • Employment • Poverty Reduction • Human Development Indices It will also identify the various policy instruments which would be appropriately applied to the achievement of these objectives. | 0 |
Other euro area countries, however, had by 2011 already recovered the previous maximum level of real GDP. The same is true of labour markets. The employment rate in the euro area as a whole is still more than two percentage points below its peak, according to OECD figures. | However, Germany has increased its employment rate by more than three percentage points (to 73.1%) while, at the other extreme, Greece has seen its employment rate dropping by more than ten percentage points (to 50.1%). Youth unemployment rates in a number of stressed countries also remain unacceptably high. | 1 |
In light of the above issues of democratic deficit and accountability, Europeans are increasingly disenchanted with the EU, as shown by the rise of populist, authoritarian parties. Support for populist political parties with eurosceptic credentials has been rising, that is, parties which are by nature more Eurosceptic and less oriented towards reforms, which of course the South badly needs. | At 3.7 percent, the unemployment rate is at its lowest level in 49 years, and payrolls have been growing well above the pace that is consistent with labor market stabilization. Historically, the few periods when resource utilization has been similarly tight have seen elevated risks of either accelerating inflation or financial imbalances. | 0 |
In parallel, the economic and fiscal policies of individual Member States did not do enough to complement the impulse coming from our very accommodative monetary policy stance, leaving euro area growth until recently far below its potential, and far below what would be needed to secure the future of our unemployed young people. | Trichet: I have already said that this is explicitly authorised by the Treaty. Over the past 11½ years, we have ensured price stability in Europe and have successfully met our target of keeping inflation below, but close to, 2%. We have done a good job fully in line with what the best central banks in Europe were doing before the euro. | 0 |
Adhering to principles of responsible finance and the G-20 principles on innovative financial inclusion can serve this purpose. It should also be noted that although financial access is critical for MSME growth, expansion of financial access should not be achieved at the cost of financial stability. | Also of concern is that core inflation is rising towards the top of the target range. Upside risks to inflation include higher electricity prices, rising wages and further depreciation of the exchange rate, which could be sensitive to changes in US interest rates. | 0 |
In light of the Committee’s request, I will give a brief overview of the economic outlook, payment breaks, issues in the insurance sector, the Tracker Mortgage Examination and the credit union sector. We are happy to expand on these or any other matters in the subsequent discussion. | All our non-standard measures help restoring a more normal monetary policy transmission mechanism which is necessary to fulfil our primary mandate of accomplishing price stability in the medium term. It is not to be confused with “quantitative easing” policies that aim to reduce longer-term interest rates by expanding the monetary base. | 0 |
The second reason why a digital euro might make sense is that people are paying less often with cash. This trend has also been observed in Germany for some time now, as confirmed by the Bundesbank’s latest study on payment behaviour in July 2022. | First and foremost – what happened at SVB reaffirms the need for strong regulations. Regulations that strengthen capital buffers and risk management. Because these are the airbags and safety belts of our financial system. | 0 |
That being said, I fully recognise the importance of access to the capital markets for banks and the role played by cash distributions. This is why, as a supervisor, I favour a careful, case-by-case approach when it comes to dividend payouts and share buybacks, especially taking into account the differences in each bank's vulnerability to downward economic pressures. | Banks are in a good starting position for these three "lines of defences". Over the last 15 years, banks have worked hard on improving their balance sheets, on cleaning up nonperforming loans, and on building up robust capital and liquidity buffers. Consequently, they are well-equipped to weather the current uncertain and challenging times. | 1 |
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