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Home / Tag Archives: Central Banks / Monetary Policy

Tag Archives: Central Banks / Monetary Policy

History of Money (Part III) | From Bitcoin to central bank digital currency

The third and final part of the series on history of money has been released. The three part series is as follows: History of Money (Part I) | From cowries to cryptocurrency  History of Money (Part II) | Currencies, banking and crises History of Money (Part III) | From Bitcoin to central bank digital currency Happy reading. This entry was posted on March 5, 2021 at 2:36 pm and is filed under Academic research & research papers,...

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Investor size, liquidity and prime money market fund stress

Fernando Avalos and Dora Xia in this BIS research: Massive redemptions at money market funds (MMFs) investing primarily in high-quality short-term private debt securities were an important feature of the market dislocations in March 2020. Building on previous studies of the underlying drivers, we find that large investors’ withdrawals did not differentiate across prime institutional MMFs according to these funds’ asset liquidity positions. We also find that, faced with large redemptions,...

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What Are the New Inflation Hawks Thinking?

Prof Brad Delong writes for Proj Syndicate: After so many years of hand-wringing over disappointing US economic growth, it is odd to hear prominent economists sounding the alarm about the mere possibility of inflation. If anything, we should want an economy in which a higher federal funds rate is warranted. This entry was posted on March 5, 2021 at 11:07 am and is filed under Academic research & research papers, Central Banks /...

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An IMF economist explains central bank digital currency to his mother

Tommaso Mancini-Griffoli in this IMF article: My dear mother, I hope this letter finds you well, back in Italy. We are fortunate to have just visited; now we’ll go back to seeing each other on screen for a few months. Still, how far we’ve come since the immigrants of the last century who could only write letters—and hope they would eventually arrive. And yet, as I unpacked, I found remnants of our visit: euro notes, unused from my trip and now souvenirs of my stay. If only I could send...

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Greening (runnable) brown assets with a liquidity backstop

Eric Jondeau, Benoit Mojon and Cyril Monnet in this new BIS paper: In anticipation of a risk of runs on brown assets and a resulting pooling equilibrium, low- and high-emissions firms are not easily differentiated by external investors. As a result, all firms face the same initial funding costs ahead of production, and some high-emissions firms will be unable to subsequently refinance their activity because investors will not take the risk of financing them. The findings also show that a...

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Limiting Central Banking

From Moneyandbanking blog Since 2007, and especially over the past year, actions of public officials have blurred the lines between monetary and fiscal policy almost beyond recognition. Central banks have expanded both the scope and scale of their interventions in unprecedented fashion. This fiscalization risks central bank independence, thereby weakening policymakers’ ability to deliver on their mandates for price and financial stability. In our view, to find a way to back to the...

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India’s Approach to Open Banking: Some Implications for Financial Inclusion

Yan Carriere-Swallow, Vikram Haksar and Manasa Patnam in this IMF paper: We examine how the development of the digital infrastructure known as the “India Stack”—including an interoperable payments system, a universal digital ID, and other features—is delivering on the government’s objective to expand the provision of financial services. While each individual component of the India Stack is important, we argue that its key overarching feature is a foundational approach of providing...

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History of Money: From cowries to cryptocurrencies (Three Part Series)

Here is my attempt to write history of money in three part series on Moneycontrol. The first two parts are out: History of Money (Part I) | From cowries to cryptocurrency History of Money (Part II) | Currencies, banking and crises Part – III to be released on 4th Mar 2021. This entry was posted on March 1, 2021 at 4:22 pm and is filed under Academic research & research papers, Central Banks / Monetary Policy, Economics - macro,...

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Negotiating Bank of England’s nationalisation

1 March 2021 marks 75 years of natioanlisation of BoE. Austen Saunders writes a post in Bankunderground blog: 1 March 2021 was the 75th anniversary of the Bank of England’s nationalisation. While its stock formerly passed into public ownership in 1946, Lord Catto (the Governor) and Hugh Dalton (the Chancellor of the Exchequer) had negotiated the terms of the Bank’s nationalisation the summer before. During these negotiations Catto lobbied for the Bank not to be given more powers to...

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Which indicator tracks Indian Banking Sector best? Price-Book Ratio?

Bhanu Pratap, Ranajoy Guha Neogi and Jibin Jose of RBI in RBI’s Feb-21 Monthly Bulletin: What is an appropriate measure of bank value? This article argues that price-to-book ratio (PBR) of banks may be considered as an alternative measure of bank value to better understand their health and stability in the Indian context. While there are several indicators such as capital adequacy ratios, Z-scores, and profitability, none of them comprehensively capture the viability of the underlying...

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