Bloomberg (October 31)
“Of all of the scary economic data that routinely streams out of Japan, this statistic should terrify you: $800 million.” The “staggeringly small figure” is the total value of completed venture capital deals for Japan in 2015. Representing Japan’s risk-adverse culture, $800 million “explains a great deal about why the world’s third-largest economy continues to struggle, no matter how much cash the central bank pours into it. Too few Japanese are starting new companies.” In comparison, 2015 venture deals totaled “$72 billion in the U.S. and $49 billion in China. Even tiny Israel managed $2.6 billion in deals.”
Tags: Central bank, China, Deals, Economic data, Israel, Japan, Risk adverse, Statistics, U.S., Venture-capital
Bloomberg (May 16)
“Never before has the Bank of Japan done so much to achieve so little. Even after arranging a record stimulus program and reducing a key interest rate to less than zero, the central bank has failed to boost inflation to its goal of 2 percent…. A central bank using up its policy tools doesn’t bode well for a nation with the world’s largest debt burden.”
Tags: BOJ, Central bank, Debt burden, Goal, Inflation, Interest rate, Policy tools, Stimulus
Investment Week (March 30)
“The past two weeks have seen a major transition in central bank philosophy, and possibly a renewed sense of coordination.” Central bankers seem to be signaling that they will not push further with negative rates and will instead embrace other methods, some non-conventional. “So far, markets have been euphoric at this turn away from the abyss and back towards some kind of ‘normality.’”
Tags: Central bank, Coordination, Markets, Methods, Negative rates, Non-conventional, Normality, Philosophy, Signaling, Transition
Financial Times (February 10)
“The Bank of Japan should not fear cutting interest rates even further.” Japan’s central bank “should not be constrained by fear that others will follow it into negative territory.”
Tags: BOJ, Central bank, Constraints, Fear, Interest rates, Negative
Wall Street Journal (November 5)
“The drumming you hear in Washington, Frankfurt and Tokyo is the accompaniment to the Central Bank Limbo, as the world’s monetary maestros line up to see how low they can go. The Bank of England (BOE) joined the queue Thursday with its announcement that a rate increase will again be delayed.” BOE Governor Mark Carney warned a year and a half earlier “that a rate rise could come ‘sooner than markets currently expect.’” Nevertheless, “Britain’s monetary-policy committee reverted to dovishness at its meeting this week.”
Tags: BOE, Carney, Central bank, Dovish, Frankfurt, Limbo, Markets, MPC, Rate increase, Tokyo, Washington
Wall Street Journal (January 16)
“The prediction that 2015 will be a year of currency turmoil is already coming true.” On Thursday, the Swiss National Bank roiled markets when it dropped its currency peg. “This won’t be the last currency shock as the world’s big central banks go their own way in frantic attempts to spur a slowing global economy.”
Tags: Central bank, Currency peg, Economy, Prediction, Shock, SNB, Switzerland, Turmoil
Institutional Investor (October 10)
“As refugees from Syria and Iraq flood across the border and, the real economy suffers, Lebanon’s central bank is looking to start-up lending as a way to boost growth.” Despite an influx of 1.3 million refugees (roughly a third of its pre-crisis population), Lebanon’s “economy has remained intact. Growth, while meager, is still projected to reach 1.8 percent this year….Much of this resilience is down to the creativity of the central bank” and the novel approaches it is adopting.
Tags: Border, Central bank, Creativity, Economy, Growth, Iraq, Lebanon, Lending, Refugees, Resilience, Start-ups, Syria
New York Times (February 18, 2014)
“Some analysts and public officials say the beleaguered euro zone is finally on the road to recovery…. But theirs is an overly optimistic view.” Europe risks falling into deflation “if government officials and central bankers do not take steps to bolster the economy.” Coordinated efforts would be ideal, but with European governments unlikely to work together “it is up to the central bank to act when it meets again next month.”
Tags: Analysts, Central bank, Deflation, Economy, Euro zone, Europe, European governments, Optimistic, Recovery
Financial Times (February 6, 2014)
“In an era when much of the world is worried about the possibility of drifting into Japanese-style deflation, one country has precisely the opposite problem: unbridled inflation.” Over the last 5 years, India’s consumer prices have been rising annually by close to 10%. “That is no small matter for the multitudinous poor, for whom escalating food prices can summon the spectre of hunger. Nor does it do much for macroeconomic stability, which India badly needs in this year of tapering and tricky political transition.” Fortunately, new central bank governor Raghuram Rajan looks “up to the task.” With his tough policies, he may prove the Paul Volcker of India.
Tags: Central bank, CPI, Deflation, Food, Governor, Hunger, India, Inflation, Japan, Macroeconomics, Paul Volker, Poor, Raghuram Rajan, Stability
Institutional Investor (December 17, 2013)
With the introduction of a new single supervisory mechanism, the European Central Bank (ECB) is positioned to play a integral role. “The coronation of the ECB as banking supervisor will make the central bank an even more powerful institution, along the lines of the Fed, which emerged from the crisis as the dominant U.S. financial regulator.”
Tags: Banking, Central bank, Crisis, ECB, eurozone, Fed, Financial regulator, Supervisory mechanism, U.S.
