Liquidity
Bank of Canada will only lend renminbi as ‘last resort’
The central bank’s financial markets chief says it is up to banks to manage their renminbi liquidity needs, including in ‘stressed circumstances’
PBoC report reveals extent of liquidity interventions
Quarterly monetary policy report reveals massive injections of liquidity to support the money supply as outward capital flows continue to accelerate
Carney: Expectations of Fed tightening could trigger ‘sharp adjustment’ in financial markets
FSB chairman says the ‘ongoing disconnect’ between risk-taking in financial markets and the real economy ‘poses the threat of sharp adjustments’
BoE’s Furse warns liquidity has become ‘more fragile’ in some markets
Post-crisis measures have increased bank resilience, but have also ‘altered the economic model’ for capital markets intermediation
BIS sees cross-border liquidity reverting to historical trend
Latest global liquidity indicators show low volatility combining with rapid cross-border credit growth; researchers challenge simple supply and demand theory of oil-price slump
ECB’s collateral move adds pressure to Greek negotiations
Decision to cease accepting some Greek debt as collateral two weeks earlier than necessary turns banks toward ELA and adds pressure to political negotiations
PBoC takes action against tighter liquidity
Cut in reserve requirements seen as effort to ease liquidity due to lunar new year and capital outflows, but may do little more than offset a growing shortage
IMF paper examines sensitivity of house prices to global liquidity shocks
Researchers find prices in emerging markets respond ‘much more’ to a shock in the international supply of credit than in advanced economies
EBA declares LCR 'not likely' to have negative impact
Impact assessment by European Banking Authority finds liquidity coverage ratio is unlikely to negatively impact bank lending or financial stability; some banks show shortfall
IMF paper considers merits of macro-prudential liquidity buffer
Working paper asks whether such a buffer would be desirable, and how it might operate in practice; authors say it would complement other requirements including the LCR and NSFR
Bank of Korea paper examines global liquidity drivers
Researchers at central bank explore transmission of global liquidity shocks from advanced to emerging market economies; warns there is no ‘silver bullet’ response
Banque de France paper says asset purchases may struggle to anchor rates
Working paper suggests asset purchases could be a way to anchor interbank rates, but the policy faces a number of difficulties; absorbing excess liquidity another option
Australian banks look to stable deposits to meet LCR, says Debelle
Interest rates on more stable deposit products are rising as banks prepare for liquidity coverage ratio’s January deadline, says Reserve Bank of Australia assistant governor
Weak TLTRO demand increases pressure on ECB
Banks borrow €129.8 through ECB's second operation; pressure increases on governing council to launch new measures in January or March 2015
IMF praises Central Bank of Kuwait’s ‘proactive’ approach
Central bank is ‘proactive’ in its liquidity management and macro-prudential supervision, IMF report says; publishing more timely information on oil sector would be ‘useful’
BIS paper spots correlations in capital control effects
Study of emerging market capital controls finds bonds flow into other regional countries if one loosens its controls, but the effect is weak when countries tighten
Iceland introduces foreign currency funding rule based on Basel Committee's NSFR
Measure is intended to limit extent to which banks fund long-term lending in foreign currencies with unstable short-term funding; Three-year NSFR could be introduced in 2015
Liquidity surplus has minor effect on short-term interbank rates, Riksbank article finds
Larger liquidity surplus in Swedish banking system since 2007 linked to downward pressure on short-term interbank rates, but effect is minor as most is invested in Riksbank Certificates
CGFS pushes central banks to prepare market-making crisis measures
BIS committee warns of ‘bifurcated’ liquidity and suggests central banks prepare crisis measures to support market-making, including the potential for direct intervention in critical markets
PBoC sheds light on opaque liquidity measures
Central bank confirms injection of billions of renminbi via new ‘medium-term lending facility’ as part of efforts to offset weaker foreign exchange inflows
BIS paper finds liquidity regulation need not harm lending
Evidence from the UK implies banks reduced their interconnectedness, but did not cut lending to the real economy in response to tighter liquidity regulations in 2010
World's biggest banks $60bn closer to Basel III target
Internationally active banks $20bn short of Basel III target, compared with $80bn six months earlier, according to Basel Committee review
Final liquidity rules issued for biggest US banks
‘More stringent' liquidity coverage ratio will come into effect in January 2017; Fed adopts final rule on supplementary leverage ratio, asks for input on swap margin rules
Bundesbank paper explores liquidity shock transmission
Claudia Buch and Linda Goldberg summarise the findings of empirical studies conducted across 11 countries to explore liquidity risk transmission