Thema Finanzmärkte

Stability Implications of Financial Interconnectedness under the Capital Markets Union

In the run-up to the European elections in May 2019, the European Commission is trying to advance the initiatives laid out in its action plan for a European Capital Markets Union (CMU). In order to diversify financing sources and to increase private risk sharing, the CMU aims at deepening the integration of European equity and debt markets. While there are benefits associated with more cross-border ...

Measuring the Effect of Foreign Exchange Intervention Policies on Exchange Rates

Central bank intervention in foreign exchange markets is a common tool to influence exchange rates. Although central bankers are convinced of their policy’s effectiveness, econometric estimates of precise effects differ across studies. The difficulties with estimations mostly result from a lack of adequate data. This article highlights different econometric approaches that aim to mitigate estimation ...

„Big Bank Theory“: Lieber grenzüberschreitend als national konsolidieren: Kommentar

The Integration of International Financial Markets: An Attempt to Quantify Contagion in an Input-Output-Type Analysis

The increasing integration of international financial markets means that credit defaults in one country have to be covered by creditors in other countries. If the principle of creditor liability were applied systematically, the financial losses incurred by the financial institution that provided the credit and is thus directly affected by the default would be ‘passed on’ through its domestic and foreign ...

Macroprudential Regulation and Leakage to the Shadow Banking Sector

Macroprudential policies for financial institutions have received increasing prominence since the global financial crisis. These policies are often aimed at the commercial banking sector, while a host of other non-bank financial institutions, or shadow banks, may not fall under their jurisdiction. We study the effects of tightening commercial bank regulation on the shadow banking sector. For this purpose, ...

Libra: Geld für die Welt? Kommentar

Sustainable Finance: Political Challenges of Development and Implementation of Framework Conditions

According to the 2015 Paris Agreement, a long-term goal is the commitment to “making finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development.” Reconciling climate change objectives and financial flows is an enormous challenge in the 21st century. States in general and Germany in particular have various instruments at their disposal to initiate ...

Macroeconomic Effects of Government Spending: The Great Recession Was (Really) Different

We estimate the effect of government spending shocks on the U.S. economy with a time‐varying parameter vector autoregression. The recent Great Recession period appears to be characterized by uniquely large impulse responses of output to fiscal shocks. Moreover, the particularity of this period is underlined by highly unusual responses of several other variables. The pattern of fiscal shock responses ...

Exchange Rates, Foreign Currency Exposure and Sovereign Risk

We quantify the causal link between exchange rate movements and sovereign risk of 16 major emerging market economies (EMEs) by means of structural vector autoregressive models (SVARs) using data from 10/2004 through 12/2016. We apply a novel data based identification approach of the structural shocks that allows to account for the complex interrelations within the triad of exchange rates, sovereign ...

Die Pläne der Kommission für die EU-Finanzen bis 2027 - stark am Status Quo orientiert

Die Kommission hat ihren Entwurf zum Mehrjährigen Finanzrahmen vorgelegt. Eine Analyse zeigt: Deutliche Ausgabensteigerungen, der größte Teil der Mittel fließt weiter in die Agrar- und die Kohäsionspolitik, für Zukunftsbereiche – bspw. Investitionen, Wachstum oder Migration – bleibt nicht mehr viel übrig.