By Wenxin Du Foreign banking organizations (FBOs) in the United States play an important role in setting the price of short-term dollar liquidity. In this post, based on remarks given at the 2022 Jackson Hole Economic Policy Symposium, we highlight FBOs’ activities in money markets and discuss how the availability of reserve balances affects these[…]
By Shekhar Aiyar and Anna Ilyina Trade openness increased after the Second World War, but has slowed following the global financial crisis. Link: Charting Globalization’s Turn to Slowbalization After Global Financial Crisis
By European Banking Authority The European Banking Authority (EBA) published today its final Guidelines addressed to resolution authorities for the publication of their approach to the bail-in tool implementation. Transparency and predictability are key both to the credibility of the resolution framework and to the safeguard of investors’ protection. These Guidelines aim at ensuring that[…]
By Gabriel Jiménez, Dmitry Kuvshinov, José-Luis Peydró, and Björn Richter Central banks have been raising interest rates to fight inflation, after a period when rates were first cut and then kept low. This column uses data for 17 developed countries over 150 years to show that policy rate hikes substantially increase crisis risk, if rates[…]
By Daniel Hinge Keeping monetary policy too loose for too long can lead to a “big” increase in the risk of a financial crisis, new research into a controversial area of policy finds. Maximilian Grimm, Òscar Jordà, Moritz Schularick and Alan Taylor say they are “the first to show that, as a causal matter, a[…]
By Christopher Clayton, Amanda Dos Santos, Matteo Maggiori, and Jesse Schreger China’s strategy for internationalising the renminbi involves controlling the access of foreign investors to the domestic bond market. This column argues China’s policy involves a trade-off between building a reputation as a country capable of providing a global store of value and risking disruptive[…]
By European Banking Authority The European Banking Authority (EBA) published today its annual quantitative Report on minimum requirement for own funds and eligible liabilities (MREL) with data as of December 2021. The Report is complemented by an analysis looking into the impact of the MREL framework on a number of relevant dimensions. As of 31[…]
By Skander J. Van den Heuvel The stringency of bank liquidity and capital requirements should depend on their social costs and benefi ts. This paper investigates their welfare effects and quantifies their welfare costs using sufficient statistics. The special role of banks as liquidity providers is embedded in an otherwise standard general equilibrium growth model. Capital[…]
By André Sapir There is a view that globalisation is in retreat. It has produced immense wealth, but has also generated huge inequality, leading to an economic and political backlash. Not everyone agrees with this view, though globalisation is seen as under geopolitical threat, in particular because of the rivalry between China and the United[…]
By Wenxin Du Foreign banking organizations (FBOs) in the United States play an important role in setting the price of short-term dollar liquidity. In this post, based on remarks given at the 2022 Jackson Hole Economic Policy Symposium, we highlight FBOs’ activities in money markets and discuss how the availability of reserve balances affects these[…]