Ocurrió un error. Detalles Ocultar
Usted tiene páginas sin guardar. Restablecer Cancelar

Central banks around the world are increasingly resorting to more dovish monetary policies against a backdrop of slowing economic growth. Among the 38 central banks tracked by the Bank for International Settlements (BIS), 21 banks adopted interest rate cuts over the three-month period from July to September, compared to 13 during the same three-month period of 2018.

  • Several advanced economies, including Denmark, Japan, Switzerland, Sweden, and the European Central Bank (ECB)-regulated Euro Area, have sustained negative interest rate environments for several years already and the multi-year outlook looks similar, according to the IMF's latest Global Financial Stability Report.
  • In September, the ECB proceeded to cut the interest rate on its deposit facility for the first time since 2016, dropping it by 10 basis points to -0.5 percent. The ECB also announced that it would re-launch its asset-buying program beginning 1 November in pursuit of its two percent inflation rate target.

Aimed at supporting economic growth and inflation through prompting firms and households to spend more money now (instead of saving), these rates represent a source of risk within the banking sector and to global financial stability as a whole. Negative interest rates force banks to pay money to central banks for keeping their excess funds overnight. Even outside the negative territory, persistently low rates narrow banks' operating margins and can lead to the accumulation of excessive corporate debt.

Percepciones relacionadas de Knoema

Bitcoin Energy Requirements Climbing Even as Revenues Fall

No matter your opinion on the prospect of digital currencies replacing traditional fiat currencies, the fact is that central banks and investors now find themselves evaluating the benefits of and exposure to cryptocurrencies. Today we’re focusing on the market and environmental implications of the large power requirements to mine bitcoin tokens and conduct digital currency transactions in a fossil-fuel dominated world. According to estimates by Dutch bank ING, one bitcoin transaction typically requires about 200 kWh of electricity, which could power a home for almost a month or run...

The Panama Papers: Key Statistics

The Washington, DC-based International Consortium of Investigative Journalists (ICIJ) has released a database of the so-called Panama Papers - information leaked primarily from Mossack Fonseca, one of the world's leading global law firms providing services of incorporation of offshore entities and headquartered in Panama. The leak is the largest ever of offshore financial records and contains about 11.5 million legal and financial records dating back more than 40 years. The files expose more than 213,000 offshore entities created in 21 jurisdictions, stripping away the secrecy from...

Will Global Debt Expansion Trigger the Next Financial Downturn?

In the 10 years since the 2008-2009 global financial crisis, aka “Great Recession,” the global debt of the non-financial sector increased by 53 percent to reach $178 trillion in the third quarter of 2018, according to the Bank for International Settlements. Global debt, which represents the outstanding credit provided by domestic banks and other institutions to households, non-financial corporations, and government, is quite simply the driver of the modern economy. Over the 2008-2018 period, each percent of GDP growth in G20 countries required, on average, 1.6 percent of debt...

Leveraged Loans: A Threat to US Economic Health?

The leveraged loans* market in the US ballooned in 2018. According to the US Federal Reserve’s latest Financial Stability Report (May 2019), leveraged loans outstanding reached $1.15 trillion in the 4th quarter of 2018, a growth of 20.1 percent during 2018 alone. At the same time, deteriorating lending standards and investors’ growing risk appetite have increased funds available to indebted companies and created fresh vulnerability within the financial system. Why should this market be of such concern if it is a shadow of the size of other markets, such as residential and...

Nuestra declaración de privacidad y política sobre cookies

Nuestro sitio web utiliza cookies para facilitar su experiencia en línea. Se guardaron en su computadora cuando usted lanzó este sitio web. Usted puede cambiar su configuración personal de cookies a través de la configuración de su navegador de Internet.

Política de privacidad