The 30 central bankers of the major economies of the industrialized and emerging countries, representing four-fifths of global GDP, will meet today in Basel to draw up the “financial parachute” after the surprising outcome of British referendum.
On Brexit the comparison between the major central bankers, in addition to 19 other Governors as observers, will take place this weekend in Switzerland. To provide an opportunity is the 86 / ma Annual Meeting of the Bank for International Settlements (BIS), “the central bank of central banks”, scheduled for today in Basel.
Already last night there was a first round table on the topic among bankers with a meeting of G-10 countries. Switzerland came in addition to the Governor of the Bank of Italy, Ignazio Visco, the ECB president, Mario Draghi, the president of the Federal Reserve, Janet Jellen, the Governor of the Bank of Japan, Haruhiko Kuroda, but also the Governor of the Bank of ‘England, Mark Carney, the most anticipated among the participants.
the Bri had already issued immediately after the outcome of the British referendum a statement that he wanted to allay the markets on the willingness to cooperate between the lead institutions’ the outcome of the EU referendum in the UK has resulted in high market volatility. Wide contingency plans by the private sector and central banks have been put in place to limit the fluctuations of the financial markets. Greater capitalization and comfortable liquidity in the private sector made the strongest financial systems. The central banks have already announced they are monitoring the situation and are ready to take the necessary measures to ensure the smooth functioning of the market. ”
But the BIS did not want to hide the perverse effects of the long period of British shock. “There will likely be a period of uncertainty and adjustment. The UK is closely integrated into the global economy, and hosts one of the most important financial centers of the world. With good cooperation at the global level, we are confident that the uncertainty can be contained and that adjustments can proceed in the best way possible. ” Of course this is the hope. But bankers, besides verbal intervention, have reassured the availability of liquidity in a position to make markets work, and if, to support financial institutions. The G-7 had put emphasis on the “excessive volatility and disorderly movements” in exchange rates.
Although the ECB had announced immediately after the result of the British vote in a terse press release that was holding under control the markets and would ensure the stability of prices and the financial system in the euro area as per mandate.
the Bank of England Mark Carney said it is ready to enter in the 250 billion pounds system so as to “keep afloat” the pound as more of G7 ministers and governors have indicated that they are prepared to use foreign exchange swap agreements (used in the Lehman crisis) with other central institutions. As the governor of the Fed, Janet Yellen, will make it clear to his colleagues to be willing to wait before raising rates, as well as to decrease the volatility even in the emerging. But in the end the bankers will demand support for politicians to use fiscal leverage in support of monetary policies and, as has already been said Christine Lagarde of the IMF, the important thing is “to clarify the process of separation. ‘Procedures and objectives Maybe even on the fate of Europe.
© ALL RIGHTS RESERVED
No comments:
Post a Comment