The ECB is due to unveil its new projections on Dec 10, along with a new stimulus package. On the non-bank side, investment funds continue to be vulnerable to sudden outflows during periods of market stress due to their relatively small liquidity buffers. The ECB is due to unveil its new projections on Dec 10, along with a new stimulus package. July 2019: Speech by Luis de Guindos – Global financial regulation: where next? The PEPP indeed proved to be a turning point in financial markets. The speech points that the euro area problem is part of a predicament shared by other advanced economies: decades of declining economic and productivity growth rates, prolonged periods of low inflation and an untamed financial sector fuelling asset price booms. Read about the ECB’s monetary policy instruments and see the latest data on its open market operations. But the recent softening of growth prospects heightens risks. Speech by Spanish Minister of Economy, Industry and Competitiveness. This is the task of macroprudential policy. First, the EU needs to address the consequences of the United Kingdom’s departure from the EU. Discover more about working at the ECB and apply for vacancies. It has helped to absorb the shock and avoided a credit crunch that would have been detrimental to the economy. While the gradual relaxation of social distancing measures created a strong yet incomplete rebound in economic activity in the third quarter, that recovery started losing momentum. Given uncertainties regarding regulatory divergence, we should not take it for granted that the EU and UK financial systems will retain their current degree of interconnectedness. The euro area financial sector in the pandemic crisis Keynote speech by Luis de Guindos, Vice-President of the ECB, at the 23rd EURO FINANCE WEEK . Advanced economies will only be able to ensure financial stability with effective macro-prudential policy interventions. An effective conduct of macroprudential policy can therefore help monetary policy to remain focussed on fulfilling its price stability mandate. When the business cycle and the financial cycles are disconnected, monetary policy must remain anchored to its goal of ensuring price stability in the markets of goods and services. Dig deeper into the ECB’s activities and discover key topics in simple words and through multimedia. A greater share of releasable buffers would enhance macroprudential authorities’ ability to act countercyclically. 04 September 2019. by Luis de Guindos. The monetary policy experience of the past seven years is reviewed. Newly originated loans have also tended to have greater credit risk, with banks reporting a higher probability of default according to their internal ratings-based portfolios in the second quarter of the year. The European Central Bank expects prices in the euro zone to keep falling this year and rebound more slowly in 2021 than it previously thought even as the prospect of a coronavirus vaccine boosts the growth outlook, ECB vice president Luis de Guindos said in an interview published on Saturday. Published on May 1, … I am honoured to speak at this Opening Conference of the 21st Euro Finance Week. Browse the ECB’s reports, publications and research papers and filter them by date or activity. The second phase, since 2013, is characterised by a more active use of the ECB’s balance sheet, as inflation started to fall significantly below 2%, accompanied by declines in various measures of long-term inflation expectations. Leaders announced the decision following a vote in the European Council in Brussels on Thursday. Low cash holdings force investment funds to sell relatively illiquid assets in the event of outflows, which serves to depress asset prices. This suggests that a comprehensive macroprudential approach for non-banks needs to be devised. Second, a broader macroprudential toolkit is needed to address risks stemming from the shadow banking sector due to its increasing role in credit intermediation. These steps are necessary to provide the macro dimension to stress testing exercises and make them fit for macroprudential policy use. With its granular and targeted instruments, macroprudential policy provides the most appropriate tool for staving off financial stability risks in the specific areas where they arise, being it at the level of a country, a sector or a financial institution. This is in line with results of the ECB’s vulnerability analysis. In a speech published today (November 16), de Guindos stressed the eurozone should develop a comprehensive macro-prudential framework for these financial entities. The link between inflation and real economic activity appears however to have strengthened in the euro area as of late (steepening of the Phillips curve). Other languages 22 + Select your language. Keynote speech by Luis de Guindos, Vice-President of the ECB, at the CIRSF (Research Centre on Regulation and Supervision of the Financial Sector, Portugal) online Annual International Conference 2020 on Major Trends in Financial … Furthermore, a comprehensive approach at national and EU level will be needed if distressed assets on bank balance sheets increase significantly. FRANKFURT (Reuters) - Euro zone inflation will remain negative for the rest of the year, European Central Bank Vice President Luis de Guindos said on Friday, just after fresh data showed price growth hitting a more than four year low. 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