ECB should keep eyes on inflation prize, End of Libor could trigger supply chain shock, and more
Latest opinion and analysis from OMFIF around the world
29 November-3 December 2021, Vol.12 Ed.48
ECB should keep eyes on inflation prize: Should central banks tighten early to combat inflation at the risk of triggering a serious slowdown, or risk higher inflation while propelling growth? This trade-off is easy to face for the European Central Bank. Excluding energy, all components of the euro area inflation basket have grown in line with their 20-year average for the last four months. And the strong tailwind from demand points to a positive outlook for 2022, write Agnès Belaisch and Matteo Cominetta.
End of Libor could trigger supply chain shock: More than 80% of trade and supply chain finance globally prices using the London interbank offer rate term benchmarks in dollars. If banks and exporters are not prepared for the transition, the end of Libor risks widespread disruption to trade and supply chain finance, writes Kathleen Tyson.
2021 review: the European borrowing landscape: Eila Kreivi, head of capital markets at the EIB, reviews the European borrowing landscape in 2021, the launch of the Next Generation EU fund and the development of the green bond market. The discussion focuses on the impact of the European Union as a major issuer, lessons learned by the EIB on debt issuance and green bonds.
CBDCs through the bankers’ lens: CBDCs could have profound implications for the global financial system. And there are questions about interoperability – what would cross-border use of CBDCs mean for correspondent banking? A panel of senior representatives from commercial and central banks reviews these topics and more.
Time is running out for Argentina and the IMF: On 15 November, Argentina’s President Alberto Fernández announced that he would seek a new IMF programme to refinance $45bn in outstanding debt. In the minds of investors, default and debt restructuring loom. Argentina’s government, at all levels, faces a huge credibility problem, writes Pablo Guidotti.