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Apr 18, 2013

Euro zone no longer faces existential threat: France’s Moscovici

WASHINGTON, April 18 (Reuters) – Europe’s monetary union is
no longer in question as it was last year, French Finance
Minister Pierre Moscovici said on Thursday, even though the
continent’s economic struggles continue.

“There is still an economic crisis in Europe, it is a crisis
of insufficient growth. There is no longer a crisis of the euro
zone,” Moscovici said, adding that the European Central Bank’s
pledge to do whatever it takes to safeguard the single currency
had been a big help.

Apr 18, 2013
via MacroScope

Central bank independence is a bit like marriage: Israel’s Fischer

For Bank of Israel governor Stanley Fischer, this week’s high-powered macroeconomics conference at the International Monetary Fund was a homecoming of sorts. After all, he was the IMF’s first deputy managing director from 1994 to 2001. The familiar nature of his surroundings may have helped inspire Fischer to use a household analogy to describe the vaunted but often ethereal principle of central bank independence.

Fischer, a vice chairman at Citigroup between 2002 and 2005, sought to answer a question posed by conference organizers: If central banks are in charge of monetary policy, financial supervision and macroprudential policy, should we rethink central bank independence?  His take: “The answer is yes.”

Apr 16, 2013

Yellen says Fed rates guidance helps support recovery

WASHINGTON (Reuters) – The Federal Reserve’s policy of communicating future intentions on interest rates helps support employment and economic growth, Fed Vice Chairwoman Janet Yellen said on Tuesday.

Yellen told an International Monetary Fund conference that she still believes the Fed’s stimulus efforts should be conducted within the context of a flexible inflation target, pushing back against the notion that central banks must rethink their mandates.

Apr 15, 2013
via MacroScope

German ghost of inflations past haunting European stability: Posen

“Reality is sticky.” That was the core of Adam Posen’s message to German policymakers on their home turf, at a recent conference in Berlin.

What did the former UK Monetary Policy Committee member mean? Quite simply, that the types of structural economic changes that Germany has been pushing on the euro zone are not only destructive but also bound to fail, at least if history is any guide.

Apr 10, 2013

Fed’s Lockhart says “premature” to discuss stimulus pullback

, April 10 (Reuters) – It is too soon for
the Federal Reserve to begin considering a tapering or halt of
its bond-buying stimulus program, Atlanta Fed President Dennis
Lockhart said on Wednesday.

“A lot of focus on that at the moment is maybe a bit
premature,” Lockhart told reporters during a press briefing on
the sidelines of an Atlanta Fed conference. “We have to wait and
watch how the data come in and see how the economy evolves.”

Apr 9, 2013

BoE’s Haldane: Need simpler bank rules that are harder to game

WASHINGTON, April 9 (Reuters) – Bank regulators need to
develop much simpler rules to make it harder for large financial
firms to game the supervisory system, Bank of England official
Andrew Haldane said on Tuesday.

“We need to do a radical pruning, simplifying of our
regulatory apparatus (that) places much less emphasis on what
are unreliable measures of risk,” Haldane, the BoE’s executive
director for financial stability, told a conference sponsored by
the Federal Reserve Bank of Atlanta.

Apr 8, 2013

Bernanke says stress tests make banks more stable

STONE MOUNTAIN, Georgia (Reuters) – Federal Reserve Chairman Ben Bernanke said on Monday the central bank’s periodic bank stress tests have made the financial system more resilient.

Contrasting the current state of banks to their tattered condition in 2009 after the historic financial crisis, Bernanke said the sector’s rebound was positive for the broader recovery given the importance of credit to economic growth.

Apr 5, 2013
via MacroScope

Yellen-san supportive of BOJ’s aggressive easing

For all the talk about clear communications at the Federal Reserve, central bank Vice Chair Janet Yellen’s speech to the Society of American Business and Economics Writers ran a rather long-winded 16 pages.

However, while Fed board members generally do not take questions from reporters, there was a scheduled audience Q&A which, at this particular event, meant it was effectively a press briefing.

Apr 4, 2013

Yellen: Fed should focus on jobs, even if inflation edges past target

WASHINGTON (Reuters) – The Federal Reserve should focus its energies on bringing down an elevated U.S. unemployment rate even if inflation “slightly” exceeds the central bank’s target, Fed Vice Chair Janet Yellen said on Thursday.

Yellen, who is seen as a potential successor to Chairman Ben Bernanke, says she looks forward to the day when policymakers can abandon unconventional tools like asset purchases and return to the conventional business of lowering and raising interest rates, currently set at effectively zero.

Apr 4, 2013

Risk appetite on the rise in U.S. capital markets: Fed survey

WASHINGTON, April 4 (Reuters) – Hedge fund and derivative
investors are taking on more risk as aggressive monetary easing
and an improving economy boost demand for higher-yielding
securities, a Federal Reserve survey showed on Thursday.

The Fed’s Senior Credit Officer Survey, which supplements
data on the banking sector with some insights into activity in
funding markets for asset-backed securities and over-the-counter
derivatives, showed one in four respondents reported an increase
in hedge fund leverage, or debt used to make financial bets.

    • About Pedro

      "Pedro da Costa has been covering economics and financial markets since 2001. He is currently based in Washington and focuses on the Federal Reserve and macroeconomic policy. Da Costa earned a Master's in international relations at the University of California San Diego and studied sociology and political science as an undergraduate at the University of Chicago and the London School of Economics. He grew up in Rio de Janeiro, Brazil."
      Joined Reuters:
      English, Portuguese, Spanish, French
      2011 Deadline Club Award from the Society of Professional Journalists' New York Chapter
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