ECB asset purchases: the three transmission channels

A new paper suggests that ECB asset purchases influence markets and the economy significantly, mainly through three channels. First, through the asset valuation channel...

How easy G3 monetary policy spills over into East Asia

A recent BIS paper illustrates the consequences of highly accommodative monetary policy in the G3 for East Asia. These include lower policy rates than...

Bank of Japan’s new mandate to overcome inflation

Bank of Japan Governor Shirakawa emphasized his instutions strengthened mandate to end deflation. The key decisions were the introduction of a 2% inflation target...

The world’s negative term premium

The term premium on the “world government bond yield” has turned decisively negative, according to BIS research. Investors have since 2014 accepted a long-term...

Time-varying macroprudential policy

Persistent highly accommodative monetary policy in the U.S. raises fears of building systemic vulnerabilities. Federal Reserve board member Tarullo has discussed the use of...

Japan’s war against deflation: progress and risks

More than a year after its launch, the impact of “quantitative and qualitative easing” seems pervasive. The Bank of Japan asserts that the output...

Why and when “equity duration” matters

A new HSBC report suggests that if and when Quantitative Easing is being reversed it could be a watershed event for sectoral equity performance....

The importance of central bank collateral frameworks

A new ECB paper illustrates the power of a central bank’s collateral framework as a policy tool. The collateral framework influences overall monetary conditions,...

The secular decline in the global equilibrium real interest rate

A new Bank of England paper finds a 450 bps decline in global equilibrium real interest rates over the past 35 years, due to a...

U.S. natural interest rate stuck at 0%: evidence and consequences

Federal Reserve research supports the view that the natural rate of interest in the U.S. has not recovered from its plunge to an unprecedented historical...

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