Posted on December 17, 2015 by iMFdirect
By Fabio Cortes
Current regulations only require U.S. and European bond mutual funds to disclose a limited amount of information about the risks they have taken using financial instruments called derivatives. This leaves investors and policymakers in the dark on a key issue for financial stability. Our new research in the October 2015 Global Financial Stability Report looks at just how much is at stake. Continue reading
Filed under: Economic research, Europe, Financial markets, International Monetary Fund, U.S. | Tagged: bonds, derivatives, financial markets, financial stability, Global Financial Stability Report, IMF, interest rates, leverage, market volatility, mutual funds, United States | Leave a comment »
Posted on January 21, 2011 by iMFdirect
By Luis M. Cubeddu and Camilo E. Tovar
(Version in Español)
Many Latin American economies are booming due to strong inflows of capital and stronger export earnings from high commodity prices. Though favorable today, this situation is also a double-edged sword.
Households, companies, and banks are spurred to take on financial risk. But, if risks become excessive or poorly managed, they sow the seeds of future problems. The region has experienced firsthand the boom and bust cycles that can ensue, and there is consensus that this needs to be avoided or minimized in the future. The IMF’s two latest Regional Economic Outlooks for the region—published in May and October 2010—focused on precisely this issue.
While the bottom line is the need for effective macroeconomic policy management and implementation, information is an essential ingredient. Continue reading
Filed under: Economic Crisis, Emerging Markets, IMF, International Monetary Fund, Latin America | Tagged: asset price bubbles, Brazil, capital flows, commodity prices, corporate financing structure, credit conditions surveys, currency mismatch, data availability, data quality, derivatives, financial institutions, financial risk, Financial Stability Report, house price indicators, maturity mismatch, Mexico, portfolio risk, Regional Economic Outlook: Western Hemisphere, statistics | 1 Comment »
Posted on April 13, 2010 by iMFdirect
Today we have released the three analytical chapters in our upcoming Global Financial Stability Report. These chapters cover some of the most relevant areas facing policymakers as they devise financial reforms that address the systemic risks that arose during the crisis and deal with potential forthcoming vulnerabilities.
Chapter 1 comes out next week. Chapter 2, published today, focuses on two questions facing policymakers attempting to reform the financial landscape. One, whether systemic risk would be reduced by placing all regulatory functions under the purview of one entity—be that a single agency or an overseeing council? And two, if we were to use capital surcharges on financial institutions to try to limit the systemic risk associated with domino-like failures, how would we construct such surcharges?
Filed under: Advanced Economies, Economic Crisis, Emerging Markets, Financial Crisis, Financial regulation, International Monetary Fund | Tagged: AIG, credit default swaps, derivatives, exchange rates, Financial regulation, Global Financial Stability Report, Lehman | 2 Comments »