Download or read book The Broad Policy Toolkit for Financial Stability written by Etienne Lepers and published by . This book was released on 2019 with total page 41 pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract: The post financial crisis period has been associated with increased countercyclical use of various financial policies, including residency-based measures. This paper analyses in a single analytical framework the relative effectiveness of three types of financial policies - macroprudential (foundations), currency-based (fences), and residency-based measures (fire doors). The findings in this paper are based on a granular quarterly database of adjustments in these policies that covers both advanced and emerging economies from 2000 to 2015. The results show that residency-based measures on bonds and credit reduce capital inflows but provide limited support for a credit-mitigation role. While no evidence emerges that macroprudential measures alter capital inflows, most appear effective in reducing credit growth. Currency-based measures may reduce both inflows and credit growth (particularly FX reserve requirements and FX lending regulations). These results indicate that the impact of policies needs to be analysed at a granular level and that policy makers should adopt an integrated view of the financial policy toolkit

Download or read book Macroprudential Policy An Organizing Framework Background Paper written by International Monetary Fund. Monetary and Capital Markets Department and published by International Monetary Fund. This book was released on 2011-03-14 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt: MCM conducted a survey in December 2010 to take stock of international experiences with financial stability and the evolving macroprudential policy framework. The survey was designed to seek information in three broad areas: the institutional setup for macroprudential policy, the analytical approach to systemic risk monitoring, and the macroprudential policy toolkit. The survey was sent to 63 countries and the European Central Bank (ECB), including all countries in the G-20 and those subject to mandatory Financial Sector Assessment Programs (FSAPs). The target list is designed to cover a broad range of jurisdictions in all regions, but more weight is given to economies that are systemically important (see Annex for details). The response rate is 80 percent. This note provides a summary of the survey’s main findings.

Download or read book Estimated Policy Rules for Capital Controls written by Gurnain Kaur Pasricha and published by International Monetary Fund. This book was released on 2020-06-05 with total page 60 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper borrows the tradition of estimating policy reaction functions from monetary policy literature to ask whether capital controls respond to macroprudential or mercantilist motivations. I explore this question using a novel, weekly dataset on capital control actions in 21 emerging economies from 2001 to 2015. I introduce a new proxy for mercantilist motivations: the weighted appreciation of an emerging-market currency against its top five trade competitors. This proxy Granger causes future net initiations of non-tariff barriers in most countries. Emerging markets systematically respond to both mercantilist and macroprudential motivations. Policymakers respond to trade competitiveness concerns by using both instruments—inflow tightening and outflow easing. They use only inflow tightening in response to macroprudential concerns. Policy is acyclical to foreign debt; however, high levels of this debt reduces countercyclicality to mercantilist concerns. Higher exchange rate pass-through to export prices, and having an inflation targeting regime with non-freely floating exchange rates, increase responsiveness to mercantilist concerns.

Download or read book FDI Qualities Policy Toolkit written by OECD and published by OECD Publishing. This book was released on 2022-06-08 with total page 196 pages. Available in PDF, EPUB and Kindle. Book excerpt: Foreign direct investment (FDI) is an important source of finance for governments looking to meet global commitments on sustainable development. The FDI Qualities Policy Toolkit complements the OECD Policy Framework for Investment by providing more detailed and tailored guidance on priorities for policy and institutional reforms.

Download or read book Macroprudential Policy An Organizing Framework written by International Monetary Fund. Monetary and Capital Markets Department and published by International Monetary Fund. This book was released on 2011-03-14 with total page 60 pages. Available in PDF, EPUB and Kindle. Book excerpt: Macroprudential policy is a complement to microprudential policy and it interacts with other types of public policy that have an impact on systemic financial stability. Indeed, prudential regulation, as carried out in the past, also had some macroprudential aspects, and the recent crisis has reinforced this focus; hence, a clear separation between “micro” and “macro” prudential, if useful conceptually, is difficult to delineate in practice. Moreover, no matter how different policy mandates are structured, financial stability tends to be a common responsibility, reflecting the far reaching consequences of financial crises. This calls for coordination across policies, to ensure that systemic risk is comprehensively addressed. Equally important, macroprudential policy is no substitute for sound policies more broadly, including, in particular, strong prudential regulation and supervision, and sound macroeconomic policies. Operational independence in other policy areas, including monetary and microprudential policy, should not be undermined in the name of macroprudential policy. Finally, given the global nature of the financial system, the multilateral aspects of macroprudential policy will need to be fully considered—an important aspect that is only touched upon in this paper.

Download or read book Staff Guidance Note on Macroprudential Policy written by International Monetary Fund and published by International Monetary Fund. This book was released on 2014-06-11 with total page 45 pages. Available in PDF, EPUB and Kindle. Book excerpt: This note provides guidance to facilitate the staff’s advice on macroprudential policy in Fund surveillance. It elaborates on the principles set out in the “Key Aspects of Macroprudential Policy,” taking into account the work of international standard setters as well as the evolving country experience with macroprudential policy. The main note is accompanied by supplements offering Detailed Guidance on Instruments and Considerations for Low Income Countries

Download or read book Should Unconventional Balance Sheet Policies Be Added to the Central Bank toolkit a Review of the Experience so Far written by Mr.Mark R. Stone and published by International Monetary Fund. This book was released on 2011-06-01 with total page 72 pages. Available in PDF, EPUB and Kindle. Book excerpt: What is the case for adding the unconventional balance sheet policies used by major central banks since 2007 to the standard policy toolkit? The record so far suggests that the new liquidity providing policies in support of financial stability generally warrant inclusion. As the balance sheet policies aimed at macroeconomic stability were used only by a small number of highly credible central banks facing a lower bound constraint on conventional interest rate policy, they are not relevant for most central banks or states of the world. Best practices of these policies are documented in this paper.

Download or read book Monetary Policy and Financial Stability written by Mr.Jeremy Clift and published by International Monetary Fund. This book was released on 2014-10-06 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Inaugural Camdessus Central Banking Lecture

Download or read book The Federal Reserve s Framework for Monetary Policy Recent Changes and New Questions written by Federal Reserve Federal Reserve Board and published by CreateSpace. This book was released on 2014-11-19 with total page 68 pages. Available in PDF, EPUB and Kindle. Book excerpt: In recent years, the Federal Reserve has made substantial changes to its framework for monetary policymaking by providing greater clarity regarding its objectives, its intentions regarding the use of monetary policy- including nontraditional policy tools such as forward guidance and asset purchases-in the pursuit of those objectives, and its broader policy strategy. These changes reflected both a response to changes in economists' understanding of the most effective way to implement monetary policy and a response to specific challenges posed by the financial crisis and its aftermath, particularly the effective lower bound on nominal interest rates. We trace the recent evolution of the Federal Reserve's framework, and use a small-scale macro model and a simple static model to help illuminate the approaches taken with nontraditional monetary policy tools. A number of foreign central banks have made similar innovations in response to similar developments. On balance, the Federal Reserve has moved closer to "flexible inflation targeting," but the Federal Reserve's approach differs in important ways from the strict implementation of that paradigm by including a balanced focus on two objectives and the use of a flexible horizon over which policy aims to foster those objectives. Going forward, further changes in central banks' frameworks may be needed to address issues raised by the financial crisis. For example, some have suggested that the sustained period at the effective lower bound points to the need for central banks to establish a different policy objective, such as a higher inflation target or nominal GDP targeting. We use our small-scale model of the U.S. economy to examine the potential benefits and costs of such changes. We also discuss the broad issue of how central banks should integrate financial stability policy and monetary policy.

Download or read book Global Financial Stability Report October 2019 written by International Monetary Fund. Monetary and Capital Markets Department and published by International Monetary Fund. This book was released on 2019-10-16 with total page 109 pages. Available in PDF, EPUB and Kindle. Book excerpt: The October 2019 Global Financial Stability Report (GFSR) identifies the current key vulnerabilities in the global financial system as the rise in corporate debt burdens, increasing holdings of riskier and more illiquid assets by institutional investors, and growing reliance on external borrowing by emerging and frontier market economies. The report proposes that policymakers mitigate these risks through stricter supervisory and macroprudential oversight of firms, strengthened oversight and disclosure for institutional investors, and the implementation of prudent sovereign debt management practices and frameworks for emerging and frontier market economies.

Download or read book Global Financial Stability Report April 2021 written by International Monetary Fund and published by International Monetary Fund. This book was released on 2021-04-06 with total page 92 pages. Available in PDF, EPUB and Kindle. Book excerpt: Extraordinary policy measures have eased financial conditions and supported the economy, helping to contain financial stability risks. Chapter 1 warns that there is a pressing need to act to avoid a legacy of vulnerabilities while avoiding a broad tightening of financial conditions. Actions taken during the pandemic may have unintended consequences such as stretched valuations and rising financial vulnerabilities. The recovery is also expected to be asynchronous and divergent between advanced and emerging market economies. Given large external financing needs, several emerging markets face challenges, especially if a persistent rise in US rates brings about a repricing of risk and tighter financial conditions. The corporate sector in many countries is emerging from the pandemic overindebted, with notable differences depending on firm size and sector. Concerns about the credit quality of hard-hit borrowers and profitability are likely to weigh on the risk appetite of banks. Chapter 2 studies leverage in the nonfinancial private sector before and during the COVID-19 crisis, pointing out that policymakers face a trade-off between boosting growth in the short term by facilitating an easing of financial conditions and containing future downside risks. This trade-off may be amplified by the existing high and rapidly building leverage, increasing downside risks to future growth. The appropriate timing for deployment of macroprudential tools should be country-specific, depending on the pace of recovery, vulnerabilities, and policy tools available. Chapter 3 turns to the impact of the COVID-19 crisis on the commercial real estate sector. While there is little evidence of large price misalignments at the onset of the pandemic, signs of overvaluation have now emerged in some economies. Misalignments in commercial real estate prices, especially if they interact with other vulnerabilities, increase downside risks to future growth due to the possibility of sharp price corrections.

Download or read book Advancing the Monetary Policy Toolkit Through Outright Transfers written by Sascha Buetzer and published by International Monetary Fund. This book was released on 2022-05-06 with total page 60 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper argues that in reserve currency issuing economies at the effective lower bound, outright transfers from the central bank to households are both more equitable and more effective in achieving monetary policy objectives than asset purchases or negative interest rates. It shows that concerns pertaining to central banks’ policy solvency and equity position can be addressed through a careful assessment of a central bank's loss absorbing capacity and, if need be, tiered reserve remuneration policies. It also spells out key differences to a debt or money financed fiscal stimulus, which are particularly pronounced in a currency union without a central fiscal capacity. The paper concludes by discussing broader institutional, political, and legal considerations.

Download or read book Macroprudential Policies to Enhance Financial Stability in the Caucasus and Central Asia written by Padamja Khandelwal and published by International Monetary Fund. This book was released on 2022-03-10 with total page 54 pages. Available in PDF, EPUB and Kindle. Book excerpt: Limited economic diversification has made the economies of the Caucasus and Central Asia particularly vulnerable to external shocks. The economies in the region are heavily reliant on oil and mining exports as well as remittances. In some countries, tourism and capital flows also play a prominent role in aggregate economic activity.

Download or read book Malaysia written by International Monetary Fund. Asia and Pacific Dept and published by International Monetary Fund. This book was released on 2020-02-28 with total page 97 pages. Available in PDF, EPUB and Kindle. Book excerpt: This 2020 Article IV Consultation highlights that the Malaysian economy is stable despite domestic and external challenges. The authorities are making progress on their reform agenda including governance reforms and measures to improve the transparency and management of public finances. Policies should focus on medium-term fiscal consolidation, while safeguarding growth and financial stability. Structural reforms are needed to enshrine in law main governance measures, and to boost productivity to achieve high income status and inclusive growth. Growth has held up and inflation has remained subdued. Domestic demand is expected to be the main driver of growth over the medium term. Risks to the outlook are, on balance, to the downside. It is recommended to that medium-term fiscal consolidation plans should be underpinned by well-identified revenue and spending measures. Pushing ahead with structural fiscal reforms, including the adoption of a Fiscal Responsibility Act, as well as improvement in debt management, public procurement, and the public investment framework is important.

Download or read book The Federal Reserve System Purposes and Functions written by Board of Governors of the Federal Reserve System and published by . This book was released on 2002 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Provides an in-depth overview of the Federal Reserve System, including information about monetary policy and the economy, the Federal Reserve in the international sphere, supervision and regulation, consumer and community affairs and services offered by Reserve Banks. Contains several appendixes, including a brief explanation of Federal Reserve regulations, a glossary of terms, and a list of additional publications.

Download or read book Monetary Policy Strategies and Tools written by Jonathan E. Goldberg and published by . This book was released on 2020 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Quest for Restoring Financial Stability in India written by Viral V. Acharya and published by Penguin Random House India Private Limited. This book was released on 2023-08-28 with total page 278 pages. Available in PDF, EPUB and Kindle. Book excerpt: An excellent primer for students wanting to learn macroeconomics and policymaking - Kaushik Basu An important and timely contribution to our understanding of the Indian economy - Raghuram Rajan How to maintain financial stability in India? Quest for Restoring Financial Stability in India is a classic work to understand this critical subject. In this Penguin edition, with a new introduction, Viral V. Acharya, former Deputy Governor of RBI offers a concrete road map for comprehensive improvement of India's economy. Authoritative and definitive, this is a must read for the students and scholars of Indian economy, policymakers and anyone interested in India's finance sector.