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Financial Economics & Central Banking

Financial Economics & Central Banking latest publications

July 26, 2021

Europe | ECB: focus slightly askew

Last week the ECB held its first meeting since announcing its Strategy review of monetary policy a few days ago, in which it faced the dual challenge of nailing down future strategy and taking decisions on existing policies.

July 22, 2021

ECB WATCH | Dovish and hawkish tones in the same package

ECB’s first policy meeting after its monetary policy strategy review was marked by a lack of unanimity, likely reflecting an intense discussion between the doves and the hawks.

July 15, 2021

Mexico | Banxico: contempt for communication

On June 24, the Board of Governors of Banco de México decided, with three votes in favor and two against, to increase the monetary policy rate by 25 basis points

July 8, 2021

ECB WATCH | ECB Strategy Review: 2% and mindful of climate change

The strategy review has been relatively moderate, introducing a symmetric and clearer (2%) inflatio target, and adopting as permanent the current toolkit. The change has been less ambitious than the one by the Fed. On climate change, the ECB is clearly more committed to specific action, but depends on other institutions

July 6, 2021

China | Currency Outlook in 2H21: Two-way fluctuation is the main theme

We provide a macro analytical framework to investigate what determines the RMB exchange rate trend in 2H21. RMB exchange rate is expected go back to the 6.4 to 6.5 range at end-2021 and will display two-way fluctuations.

June 28, 2021

Global | A new decade for inflation

The most recent U.S. inflation rate of 5%, a level unseen since 2008, has set the alarm bells ringing. In the eurozone, where recovery is intense but less dynamic, inflation is also rising, reaching 2% in May.

June 28, 2021

Global | Emerging market flows look towards the US

The increase in vaccination rates has enabled a gradual reopening of the economy, which, alongside the loosening of repressed demand and excess saving, means that the global economy is on track for a major recovery accompanied by a rise in inflation, which should, theoretically, only be temporary.

June 26, 2021

Mexico | Total deposits dropped in April affected by a negative base effect

At present the significant growth in demand deposits has more than offset the slump of term deposits. Given that the rise in demand deposits can be related to temporary factors, the underlying question is: To what extent and how fast will households and companies reduce their accumulated liquid balances as COVID cases drop?