Rising interest rates expose the interaction between hidden losses on long-duration assets and flighty uninsured deposits. This column uses confidential data for 139 euro area banks to analyse this mechanism. It estimates that unrealised losses on loans and bonds held at amortised cost averaged about 30% by September 2023, and were largest for smaller retail […]
Dollar on course to end week flat against EUR; lower against JPY, GBP The dollar was largely steady against the euro and British pound on Friday as traders trimmed wagers on monetary policy easing by the U.S. Federal Reserve following hotter-than-expected wholesale inflation data. The Japanese yen, meanwhile, firmed broadly following surprising strong economic growth […]
The presence of directors on the boards of competing firms (‘interlocking directorates’) raises concerns about collusion. This column studies the Italian corporate loan market and exploits a reform that prohibited directors of Italian banks from sitting on multiple boards simultaneously. Comparing treated and control loans before and after the policy, it shows that the ban […]
Understanding how households interpret macroeconomic policy is vital to the effectiveness of central banks. This column demonstrates that the reactions of individual households frequently contradict standard theoretical playbooks. Using euro area survey data, the authors find that households interpret policy through a lens shaped by recent crises – such as the energy shock following Russia’s […]
