Stablecoins have become one of the most debated topics in contemporary financial policymaking, especially following the enactment of the GENIUS Act in the United States. Beyond the U.S.—and outside monetary jurisdictions whose exchange rate regimes and monetary policies are closely aligned with the U.S. dollar—policy responses have diverged significantly, ranging from outright bans, as in […]
Category Archives: Macroeconomics and Monetary Policy
Financial Stability, Macroeconomics and Monetary Policy
Capital Flow Management during the Taper Tantrum
20
Feb
Feb
Emerging market economies often face acute challenges in the wake of sudden bouts of market volatility triggered by sharp capital outflows. Managing such turbulence—particularly when macroeconomic fundamentals offer limited support—requires a calibrated mix of conventional and unconventional policy responses. There is rarely a textbook solution to crises of this nature; central banks must deploy all available instruments with agility, while maintaining credible and consistent communication to anchor expectations.
Macroeconomics and Monetary Policy
When Banks and Insurers Move Together: Why Systemic Risk Lives in the Tails?
19
Jan
Jan
Why bank–insurance linkages matter more than ever? The global financial system no longer operates in silos. Over the past two decades, a significant convergence has occurred: banks have expanded into insurance and asset management, while insurers have deepened their presence in capital markets through corporate bonds, private equity, derivatives, and structured products (Bernardi & Petrella, […]
Macroeconomics and Monetary Policy
Not All Fiscal Cuts Are Created Equal: Why Fiscal Multipliers Matter for Central Banks?
05
Dec
Dec
1. Introduction: Why Fiscal Multipliers Matter for Central Banks? As of September 2025, global public debt soared to $251 trillion, roughly 235% of world GDP (IMF, 2025). Across Asia, governments are under pressure to tighten their budgets to ensure debt sustainability. However, for central banks charged with safeguarding economic and price stability, how those fiscal […]
Macroeconomics and Monetary Policy
Nonresponse Bias is Distorting Household Inflation Expectations: Evidence and Policy Fixes
05
Nov
Nov
Author’s note: This blog is based on a published article: CHADWICK, M., CHERRY, R. and GALIMBERTI, J.K. (2025), Nonresponse Bias in Household Inflation Expectations Surveys. Journal of Money, Credit and Banking. https://doi.org/10.1111/jmcb.70002 The views expressed in this paper are those of the authors and do not necessarily represent the views of their corresponding institutional affiliations. […]
Financial Stability, Macroeconomics and Monetary Policy
How can Emerging and Frontier Markets in Asia attract Global Cross-Border Capital Flows for their Climate Transition?
03
Jul
Jul
“To reach net-zero greenhouse gas (GHG) emissions by 2050, entities operating in most sectors must undergo a major transformation. The key tool that will enable this transformation is the development of a transition plan that is science based, coherent, comprehensive, transparent and covers all material scopes of emissions and business activities.” CBI Report on Scaling […]
17
Apr
Apr
There has never been any asset that has staged a series of four bubbles, crashed aftereach of them, and after a while regrouped to stage another bubble, the way bitcoin has.John Authors, Points of Return, 26 March 2021 Every aspiring baker knows only too well that getting a soufflé to rise can be a big […]
Macroeconomics and Monetary Policy
Addressing Climate Risks in Central Banks: Emerging Challenges for SEACEN Member Economies
22
Mar
Mar
Climate change poses a common and potentially overwhelmingmacrofinancial risk for all SEACEN member countries.Michael D. Patra, Deputy Governor, Reserve Bank of India, 15 February 2024 Introduction Many SEACEN economies are acutely vulnerable to natural disasters and the broader impact of climate change. Figure 1 illustrates the mean temperature and precipitation change within the last century […]
21
Jun
Jun
The swift downfall of Silicon Valley Bank (SVB) amidst the recent banking crisis in the United States has sparked renewed curiosity regarding the potential impact of central bank digital currencies (CBDCs) on financial stability. The collapse of Silicon Valley Bank has started a stampede in the outflow of deposits from banks. Bank deposits have fallen […]
Macroeconomics and Monetary Policy
Dollar Strength and its Implications for Emerging Market Capital Flows – A Macro-Financial Perspective
31
May
May
Predominance of the US dollar (USD) funding market, notably post Great Financial Crisis (GFC), has reinforced the macro financial linkages between global financial conditions and capital flows to emerging markets (EM). A stronger dollar is linked to tighter global financial conditions and higher tail risk for EM capital flow withdrawal – the financial risk […]