Capital controls
Fijian authorities say there are no plans to lift capital controls
IMF warns not removing controls could harm foreign investment; central bank says it will review controls with respect to the level of foreign reserves
Education key to forex liberalisation success, says Bahamas governor
Private sector needs to base forex decisions on returns rather than “fear the erosion of wealth”, says Rolle
Venezuela’s new forex auction sees bolivar plummet
Latest auction sees currency devaluate by 99% from heavily subsidised exchange rate
Thailand eases foreign exchange rules to encourage outflows
Central bank seeks to cool down the baht, one of the fastest-appreciating Asian currencies
Renminbi struggles to gain prominence on global stage – Swift
Chinese currency usage only accounted for 1.61% of domestic and cross-border payments in December 2017; digitisation may be the key to currency’s success
Lifetime achievement award: Perng Fai-nan
Pre-emptive financial reforms combined with flexible monetary and forex policies have enabled Taiwan’s veteran governor to provide economic stability, even during turbulent times
Angola drops dollar for euro in new exchange rate regime
Kwanza depreciates 11.5% against the dollar following regime change
Book notes: The Right Balance for Banks, by William Cline
An interesting analysis of optimal capital requirements for G-Sibs, examining whether Basel III requirements will be enough to stem another financial crisis
Bank of Canada paper studies capital control motivations
Researcher designs policy rule to study whether capital controls are imposed with “mercantilist” or “macro-prudential” motivations
EMs should work to avoid ‘macro-prudential war’ – BIS article
Use of macro-prudential policies should be co-ordinated internationally for maximum effect, say Luiz Pereira da Silva and Michael Chui
Fed paper calls for rethink of conditions for setting capital controls
Policymakers should also consider how external shocks affect the borrowing capacity of the country, researchers say
Evolution of monetary policy in advanced economies spells trouble for emerging markets – paper
Research explores the impact future monetary policy will have on emerging markets, concluding many will be forced to implement defensive measures
BNM governor warns global bodies against ‘one-pill-cures-all’ mindset
Wealth of information from multilateral institutions has aided decision-making, but narrow definition of the ‘right’ policies could lead to worse outcomes, Muhammad Ibrahim says
Paper explores effects of capital controls on cost of international debt
Restrictions on capital inflows produce “substantial” corporate bond spreads but effects are mitigated for firms in EU or with English legal origins
Illicit capital flows a problem for countries without capital controls – Mminele
Mminele explains how capital controls benefited cross-border flow monitoring; Sarb deputy calls for a “more consistent” approach to capital flow management
Chile’s Marcel praises Argentine reforms
IMFC chairman says reforms have “paid off”, helping the country re-enter the global economic stage; lifting of capital controls and export restrictions will contribute to Argentina’s growth in 2017
Thinking on global capital flows is muddled – BIS’s Shin
BIS head of research says policies to guard against excess global liquidity should look at underlying causes, not symptoms such as capital flows; Fed’s Fischer acknowledges policy spillovers
Icelandic leaders clash on possible peg
Prime minister challenges finance minister’s assertion that the krona needs to be pegged; government launches review of exchange rate policy
Bahamas further relaxes capital controls
Specific sectors of the economy will be able to obtain foreign exchange from banks both at home and abroad; non-resident firms to gain credit from international banks licensed in the Bahamas
Iceland lifts capital controls
Controls on individuals, firms and pension funds lifted, though the central bank will retain controls on inflows to resist carry trade
Kazakhstan’s long path to inflation targeting
After a slow start, the National Bank of Kazakhstan’s implementation of inflation forecast targeting is beginning to mature. By Warren Coats
Nigeria’s central bank rolling back forex restrictions
Allocation rules are scrapped under the new regime, while all forex dealers must open outlets at airports to aid travellers; additional forex is to be made available for tuition and medical expenses
Bitcoin exchange halts service after PBoC clampdown
BTC123 becomes first exchange in China to halt services due to ongoing investigation by government agencies into virtual currency; cuts rates on wealth products
IMF delay forces National Bank of Ukraine to keep forex controls
Central bank to leave foreign exchange controls in place until political instability subsides and reforms are under way; IMF acknowledges progress, but says more is needed before the third review