Central Bank Emergency Support To Securities Markets
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Central Bank Emergency Support To Securities Markets
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Author : Darryl King
language : en
Publisher: International Monetary Fund
Release Date : 2017-07-10
Central Bank Emergency Support To Securities Markets written by Darryl King and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2017-07-10 with Business & Economics categories.
This paper considers the central bank mandate with respect to financial stability and identifies the links to the functioning of securities markets. It argues that while emergency support to securities markets is an important part of the crisis management response, a high bar should be set for its use. Importantly, it should be used only as part of a comprehensive policy package. The paper considers what types of securities markets may be important for financial stability, what market conditions could trigger emergency support measures, and how programs can be designed to restore market functioning while minimizing moral hazard.
Emde Central Bank Interventions During Covid 19 To Support Market Functioning
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Author : Mr. Kelly Eckhold
language : en
Publisher: International Monetary Fund
Release Date : 2024-05-17
Emde Central Bank Interventions During Covid 19 To Support Market Functioning written by Mr. Kelly Eckhold and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2024-05-17 with Business & Economics categories.
This paper examines emerging market and developing economy (EMDE) central bank interventions to maintain financial stability during the COVID-19 pandemic. Through empirical analysis and case study reviews, it identifies lessons for designing future programs to address challenges faced in EMDEs, including less-developed financial markets and lower levels of institutional credibility. The focus is on the functioning of the financial markets that are key to maintaining financial stability—money, securities, and FX funding markets. Several lessons emerge, including: (i) objectives should be well-specified and communicated to facilitate eventual exit; (ii) intervention triggers should prioritize liquidity metrics over prices; (iii) actions should be sufficiently large to address market dysfunction; (iv) the risks of fiscal dominance and moral hazard should be minimized; and (v) program design should incentivize self-liquidation by appropriate pricing or through short-term operations that quickly liquidate. While interventions may increase risks to central bank balance sheets, potentially challenging policy solvency and operational independence, a well-designed framework can significantly mitigate these risks.
Government Securities Versus Central Bank Securities In Developing Open Market Operations
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Author : Mr.Marc Quintyn
language : en
Publisher: International Monetary Fund
Release Date : 1994-05
Government Securities Versus Central Bank Securities In Developing Open Market Operations written by Mr.Marc Quintyn and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 1994-05 with Business & Economics categories.
In an indirect monetary policy framework, open market operations become the central bank’s main instrument. In the initial stages, when financial markets are still undeveloped, selection of a financial instrument for those operations and the design of supporting arrangements to ensure the central bank’s operational autonomy when using the instrument, are crucial issues. Based on theoretical arguments and experience of a sample of countries that embarked on financial reforms, this paper argues that government securities are the preferred instrument because of their better capacity to develop financial markets. The use of government securities, however, requires the most complex supporting arrangements.
Responsibility Of Central Banks For Stability In Financial Markets
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Author : Mr.Garry J. Schinasi
language : en
Publisher: International Monetary Fund
Release Date : 2003-06-01
Responsibility Of Central Banks For Stability In Financial Markets written by Mr.Garry J. Schinasi and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2003-06-01 with Business & Economics categories.
What is the role of central banks in ensuring financial stability? This paper addresses this controversial subject, in part by drawing on the experiences in Europe, Japan, and the United States, and by examining four questions. What is meant by financial stability? Do central banks have a natural role in ensuring financial stability? What does a central bank need to execute this role effectively? How far have central banks actually gone in safeguarding financial stability? The experience drawn on in the paper suggest that central banks: have a natural role to play; at times may require supervisory information to execute this natural role; and have incurred risks to their balance sheets to ensure financial stability.
Euro Area Policies
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Author : International Monetary Fund. Monetary and Capital Markets Department
language : en
Publisher: International Monetary Fund
Release Date : 2018-07-19
Euro Area Policies written by International Monetary Fund. Monetary and Capital Markets Department and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2018-07-19 with Business & Economics categories.
The flexibility shown by the ECB/Eurosystem in adapting its framework, as required by circumstances, has helped improve funding and liquidity conditions. Compared to the situation pre-crisis, the ECB/Eurosystem has provided liquidity against a broader range of collateral and for as long as four years in terms of maturity; extended liquidity in foreign currency; conducted outright purchases of public and private sector assets (now tapering off); and reduced interest rates into negative territory. In these arrangements, policy is directed from the center, but is implemented mostly by the National Central Banks (NCBs); risks are largely shared. Market participants are complimentary about the role the ECB/Eurosystem has played in backstopping the financial system and its forward guidance on monetary policy.
Samoa
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Author : International Monetary Fund. Monetary and Capital Markets Department
language : en
Publisher: International Monetary Fund
Release Date : 2015-08-07
Samoa written by International Monetary Fund. Monetary and Capital Markets Department and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2015-08-07 with Business & Economics categories.
This Note discusses the framework for banking resolution and crisis prevention and management in Samoa, and provides comments and recommendations for its improvement. As part of the Financial Sector Assessment Program for Samoa, this technical note evaluates the current legal powers and operational capabilities at the disposal of the financial sector authorities for confronting serious banking problems, and for crisis prevention and management. Comments and recommendations are provided, aimed at increasing the authorities’ capacity to address such problems in a way that minimizes damages to the financial system and reduces costs for the tax payer and for the economy as a whole. Key Findings and Recommendations The current regulatory framework to deal with financial institutions (FIs) should be reformed. The Central Bank of Samoa (CBS) has issued “Prudential Statements” containing some prudential rules, ratios and limits applicable to FIs, but there are no general standards for their enforcement, which is done on a purely discretional case-by-case basis. The powers from the Central Bank Act (CBA) are not strong enough to enable the CBS to take enforcement actions.
The Lender Of Last Resort Function After The Global Financial Crisis
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Author : Marc Dobler
language : en
Publisher: International Monetary Fund
Release Date : 2016-01-22
The Lender Of Last Resort Function After The Global Financial Crisis written by Marc Dobler and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2016-01-22 with Business & Economics categories.
The global financial crisis (GFC) has renewed interest in emergency liquidity support (sometimes referred to as “Lender of Last Resort”) provided by central banks to financial institutions and challenged the traditional way of conducting these operations. Despite a vast literature on the topic, central bank approaches and practices vary considerably. In this paper we focus on, for the most part, the provision of idiosyncratic support, approaching it from an operational perspective; highlighting different approaches adopted by central banks; and also identifying some of the issues that arose during the GFC.
Central Bank Transparency Code Review Guidance Note
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Author : International Monetary Fund. Monetary and Capital Markets Department
language : en
Publisher: International Monetary Fund
Release Date : 2023-11-17
Central Bank Transparency Code Review Guidance Note written by International Monetary Fund. Monetary and Capital Markets Department and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2023-11-17 with Business & Economics categories.
This document provides guidance and practical suggestions for conducting reviews of the Central Bank Transparency Code (CBT) to IMF staff and experts conducting reviews, as well as to the central banks participating or intending to participate in the CBT review.
Central Counterparties
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Author : Froukelien Wendt
language : en
Publisher: International Monetary Fund
Release Date : 2015-01-27
Central Counterparties written by Froukelien Wendt and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2015-01-27 with Business & Economics categories.
Central counterparties (CCPs) can offer significant benefits to a market. However, CCPs are also highly interconnected with financial institutions and markets and therefore too important to fail. The increased volumes cleared through CCPs and their increasing global scope, in particular in the OTC derivatives market, make it even more important that systemic risks related to CCPs are managed. This paper argues that the current set of international policy measures does partly address these risks, but that alternative policy measures are needed to reduce remaining systemic risks. For example, the paper recommends network analysis to be conducted by CCPs and authorities to gauge potential losses and suggests a common international approach to central bank services to help reduce the dependency of CCPs on services provided by commercial banks.
Kingdom Of Eswatini
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Author : International Monetary Fund. Monetary and Capital Markets Department
language : en
Publisher: International Monetary Fund
Release Date : 2024-04-05
Kingdom Of Eswatini written by International Monetary Fund. Monetary and Capital Markets Department and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2024-04-05 with Business & Economics categories.
The IMF conducted a diagnostic review of the financial system of the Kingdom of Eswatini and proposed a Technical Assistance Roadmap to support the authorities’ detection of risks and vulnerabilities and to enhance capacity in financial sector oversight. The financial stability module focused on areas agreed with the country authorities: financial stability and systemic risk monitoring, macroprudential frameworks and tools; crisis management and financial safety net; and supervision and regulation of banks, nonbank deposit-taking institutions, insurance, and retirement funds. The financial sector statistics module focused on key gaps in monetary and financial statistics and financial soundness indicators that hamper financial stability analysis.