Quality Report 2019 This annual report provides a quality review of the quarterly euro area and national financial accounts. The report fulfils the formal requirement for the Executive Board of the European Central Bank (ECB) to inform its Governing Council
Issues note on liquidity in the corporate bond and commercial paper markets, the procyclical impact of downgrades and implications for asset managers and insurers The coronavirus (COVID-19) pandemic and the measures necessary to contain it have brought a severe and
The results of Q2 2020 ECB Survey of Professional Forecasters (SPF) have to be seen in the context of the outbreak of the coronavirus (COVID-19) pandemic and subsequent mitigation measures. 1 Expectations for euro area inflation, growth and unemployment were
2019 marked the 20th anniversary of the introduction of the euro, and support for the single currency among euro area citizens reached an all-time high of 76% in the November Eurobarometer poll.
This report presents the main results of the 22nd round of the Survey on the Access to Finance of Enterprises (SAFE), which was conducted between 2 March and 8 April 2020. Despite the difficulties in conducting the survey owing to
The ESRB risk dashboard is a set of quantitative and qualitative indicators of systemic risk in the EU financial system. The composition and presentation of the ESRB risk dashboard were reviewed in the fourth quarter of 2019.
Statistics Paper Series The Household Finance and Consumption Survey (HFCS) is a joint project of all of the national central banks of the Eurosystem, the central banks of three EU countries that have not yet adopted the euro, and several
Abstract The quality of the geographical breakdown in the balance of payments and related statistics (such as international trade in goods, trade in services and foreign direct investment (FDI) statistics) can be assessed by means of comparisons with mirror data
Preface: This publication, launched in parallel with the ECB’s report on financial integration and structure in the euro area, brings together two sets of statistical indicators which were previously presented in separate ECB reports. The first part of the publication
Preface: As part of its efforts to streamline and focus its publications, the ECB has decided to combine the previous report on “Financial integration in Europe” (last published in May 2018) 1 and the previous “Report on financial structures” (last
Introduction Findings from the LSI risk report help to identify risks and vulnerabilities affecting the euro area banking system, with a specific focus on issues related to small and medium-sized banks.4 These findings then feed through to the supervisory priorities
Executive summary The working group on euro risk-free rates – which recommended replacing the euro overnight index average (EONIA) with the new risk-free rate, the euro short-term rate (€STR) – is assisting the market in the smooth transition from EONIA
Executive summary The ongoing digitalisation of the economy represents a major challenge for the payments ecosystem, requiring that a balance be struck between allowing a certain degree of privacy in electronic payments and ensuring compliance with regulations aimed at tackling
ECB Economic Bulletin, Issue 1 / 2020 Summary Incoming information since the last Governing Council meeting in early December is in line with the Governing Council’s baseline scenario of ongoing, but moderate, growth of the euro area economy. In particular,
Outline Lessons from the first two decades of the euro EMU architecture: further steps Challenges facing the ECB (Challenges facing other policymakers) The future of money (globally
By ESRB Expert Group on the Macroprudential Use of Margins and Haircuts This report considers systemic risks arising from the procyclicality associated with margin and haircut practices and sets out possible policy options to address these. Post-crisis regulatory reforms have resulted
This report considers systemic risks arising from the procyclicality associated with margin and haircut practices and sets out possible policy options to address these. Post-crisis regulatory reforms have resulted in the majority of derivatives being centrally cleared or subject to
Monetary Policy Frameworks • International dimension: global shocks; external shocks; external sector as a hedge against domestic shocks; international transmission of monetary policy • Choice of price index; time horizon for inflation target • Single country view; global view •
The 20th anniversary of Economic and Monetary Union (EMU) offers an opportunity to look back on the ECB’s record and learn lessons that can improve the conduct of policy in the future. This paper charts the way the ECB has
Philip R. Lane Member of the Executive Board European Commission Directorate General for Economic and Financial Affairs Annual Research Conference
This paper takes an eclectic approach to investigating the notion of overcapacities in banking along the dimensions of (i) banking sector size, (ii) bank competition and (iii) banking infrastructure/efficiency, thereby offering a nuanced and granular view of the topic. In
Special topic Additional results from quarterly business surveys – focus on trends in manufacturing
Update on economic and monetary developments The risks surrounding the euro area growth outlook remain on the downside. In particular, these risks pertain to the prolonged presence of uncertainties, related to geopolitical factors, rising protectionism and vulnerabilities in emerging markets.
Report by the working group on: euro risk-free rates On the financial accounting implications of the transition from EONIA to the €STR and the introduction of €STR-based fallbacks for EURIBOR This report by the working group on euro risk-free rates
Interest rate benchmarks ‐ also known as reference rates or just benchmark rates ‐ are regularly updated interest rates that are publicly accessible. They are a useful basis for all kinds of financial contracts such as mortgages, bank overdrafts, and other more complex financial
Presentatien by: Philip R. Lane Member of the Executive Board the euro area is facing a more extended slowdown than previously expected the convergence of inflation towards the inflation aim has recently slowed and partly reversed the ECB’s monetary policy
Conditionality is at the very heart of IMF lending and has been the subject of intense debates ever since the Fund’s inception. Its success is of crucial importance not only for countries’ chances of achieving the goals of IMF lending
Money market trends as observed through MMSR data* In 2018, thanks to the granular data gathered via money market statistical reporting (MMSR), the Eurosystem was able to undertake for the first time a complete and thorough assessment of developments in
Philip R. Lane Member of the Executive Board Keynote speech at Bloomberg London 16 September 2019
We present a simple model that quantitatively replicates the behavior of stock prices and business cycles in the United States. The business cycle model is standard, except that it features extrapolative belief formation in the stock market, in line with
Keynote speech at Bloomberg London 16 September 2019 Philip R. Lane Member of the Executive Board
The U.S. economy has recently experienced two, seemingly unrelated, prominent phenomena: a large increase in life expectancy conditional on retirement and a major expansion in securitization and shadow banking activities. We argue that they may be indeed intimately related. Agents
We analyze the information content of the digital footprint – information that people leave online simply by accessing or registering on a website – for predicting consumer default. We show that even simple, easily accessible variables from the digital footprint
We develop a new theory of information production during credit booms. In our model, entrepreneurs need credit to undertake investment projects, some of which enable them to divert resources towards private consumption. Lenders can protect themselves from such diversion in
Growth has fallen in the U.S., while firm concentration and profits have risen. Meanwhile, labor’s share of national income is down, mostly due to the rising market share of low labor share firms. We propose a theory for these trends
This paper reviews developments in fiscal rules in the European Union (EU) from the entering into force of the Treaty on European Union (the “Maastricht Treaty”), which laid the foundations for the euro, until today. It seems safe to say
Euro area governments have committed to break the doom loop between banks and sovereigns. But policymakers disagree on how to treat sovereign exposures in bank regulation. Our contribution is to model endogenous sovereign portfolio reallocation by banks in response to
Using a representative sample of businesses in the euro area, we show that Eurosystem purchases of corporate bonds under the Corporate Sector Purchase programme (CSPP) increased the net issuance of debt securities, triggering a shift in bank loan supply in
The structural Phillips Curve is a useful framework Slack in the economy, inflation expectations and markups are key determinants of inflation Using cross-country variation or external instruments are promising routes to identify the Phillips Curve slope Reduced-form empirical relation between
Macroeconomic studies suggest that employment-output elasticities in the euro area increased during the recovery from the crisis, especially in those countries that implemented reforms. In this paper, we use micro (individual-level) data from the Eurostat Labour Force Survey to investigate
Despite notable improvements in the labour market since 2013, wage growth in the euro area was subdued and substantially overpredicted in 2013-17. This paper summarises the findings of an ESCB expert group on the reasons for low wage growth and
Stablecoins claim to stabilise the value of major currencies in the volatile crypto-asset market. This paper describes the often complex functioning of different types of stablecoins and proposes a taxonomy of stablecoin initiatives. To this end it relies on a
Occasional Paper Series As a result of technological advancements, instant delivery of digital services has become the norm in today’s society. Yet, until recently, this trend did not extend to retail payment services, which normally took one or up to
A US dollar funding premium in the EUR/USD cross currency swap market has been in existence since 2008. Whilst there are many reasons behind this dislocation, since 2014 the divergence in monetary policy between the euro area and the United
ECB Economic Bulletin, Issue 5 / 2019 Incoming information since the last Governing Council meeting in early June indicates that, while further employment gains and increasing wages continue to underpin the resilience of the economy, softening global growth dynamics and
Survey The Eurosystem conducts a quarterly qualitative survey on credit terms and conditions in euro-denominated securities financing transaction and over-the-counter (OTC) derivatives markets. This survey is a follow-up to the recommendation in the Committee on the Global Financial System study
The results of the ECB Survey of Professional Forecasters (SPF) for the third quarter of 2019 show HICP inflation expectations of 1.3%, 1.4% and 1.5% for 2019, 2020 and 2021, respectively.1 This represents downward revisions of 0.1 percentage points for
The results reported in the July 2019 bank lending survey (BLS) relate to changes observed during the second quarter of 2019 and expectations for the third quarter of 2019. The survey was conducted between 17 June and 2 July 2019.
Occasional Paper Series – No 227 / July 2019 Foreword A first draft of this paper was circulated at the occasion of the third annual ECB Macroprudential Policy and Research Conference held on 17-18 May 2018. This occasional paper explains how
This paper presents an approach to a macroprudential stress test for the euro area banking system, comprising the 91 largest euro area credit institutions across 19 countries. The approach involves modelling banks’ reactions to changing economic conditions. It also examines
