In July, the Capital Requirements Regulation were amended, through the so called CRR quick fix, and the European Central Bank as well as the European Securities and Markets Authority issued new guidelines.
Legislative acts on targeted longer-term refinancing operations, cross-border distribution of investment funds, and the position of the German government on the financial transaction tax: a selection of financial regulatory developments from this month.
The ruling on the European Central Bank’s quantitative easing appears to open up an irremediable conflict at the heart of the euro area, with potentially fatal consequences for the currency and its central bank. It may turn out differently.
The target balances generate discussions in the public and among economists who come to very different results in their analyses. An overview of the most important arguments.
Ignazio Angeloni: According to some, the ECB can learn from the Fed on how to deal with dissent. The US system, however, is not a reference Europe can easily conform to.
Tobias Tröger: Even ardent Europeans may learn a (limited) lesson as the court is willing to take a deeper look into the machine room of central banks' operations.
Jan Krahnen: Loud is the criticism awarding the Order of Merit of the Federal Republic of Germany to Mario Draghi, who is said to have harmed the German saver. The opposite is true
The reform of the ESM turned out to be one of the main political issues in Italy at the end of this year, to the point of posing an existential threat to the sitting government. However, a well-functioning ESM is of vital interest in particular to countries like Italy.
Alexander Ludwig: The ECB has reached a limit with its monetary policy. Other policy responses are needed: an expansion of fiscal measures for more investment in infrastructure and education.
Baptiste Massenot: Central banks decide on aid programs worth billions to mitigate the economic impact of the coronavirus pandemic. But how equitable are these measures?
Alexander Ludwig: Central banks are held responsible for the continuous low-interest rate environment. However, there are many indications that the demographic trend is lowering natural interest rate.
Matthias Goldmann: The European Court of Justice’s verdict on the bond purchases of the European Central Bank (ECB) shows the rationalizing effect of legal discourses.
Ignazio Angeloni: The return to normality after the coronavirus pandemic requires, among other things, that banks be saved, and this will not happen unless regulation is adapted and more public support is provided.
In July, the Capital Requirements Regulation were amended, through the so called CRR quick fix, and the European Central Bank as well as the European Securities and Markets Authority issued new guidelines.