The BIS hosts nine international organisations engaged in standard setting and the pursuit of financial stability through the Basel Process. Our mission is to support central banks' pursuit of monetary and financial stability through international cooperation, and to act as a bank for central banks. The BIS provides central banks and financial supervisory authorities with a forum for dialogue and cooperation, where they can freely exchange information, forge a common understanding and decide on common actions.
Through our programme of regular meetings and our support to the main global standard setters for the international financial system, we help to promote dialogue among central banks and supervisory authorities to foster global monetary and financial stability. The BIS also promotes international cooperation in the area of financial stability through its Financial Stability Institute , which supports central banks and other financial authorities in the implementation of global regulatory standards and sound supervisory practices.
Our representative offices in Asia-Pacific and the Americas also play a key role in this regard, by strengthening relationships and promoting cooperation between the BIS and regional central banks and supervisory authorities. The future of central banking is inextricably linked to innovation. Whether it is in the area of artificial intelligence, big data, fintech, digital currencies or green finance, innovation gives us the opportunity to leverage technology to explore new public goods for central banks and make the financial system work better for everyone.
To respond to the increasing need for central banks to collaborate in this space, the BIS Innovation Hub Centres provide a platform for responsible innovation, and the Cyber Resilience Coordination Centre enables central banks to protect themselves from the associated risks.
We work together with central banks to explore the technological innovation that is rapidly transforming the financial landscape, to help them realise its benefits while avoiding the associated risks. It used to be taken for granted that at least one such asset was needed to facilitate international trade and the accumulation of international purchasing power.
Precious metals and national currencies have in turn—and sometimes in combination—served as international money.
Just before the convertibility of foreign-held U. At the beginning of the s, suspension of the gold convertibility of the U. Nevertheless, the U. Before long, the dollar had to share its international monetary role with the currencies of a number of other industrial countries, with the values of these currencies linked in a volatile manner by floating exchange rates.
Could the future hold a more important role for the SDR as an international reserve medium, with gold phased out of the system and the international importance of the U. There are those who say that in a world of floating exchange rates a central reserve asset is not needed.
Market-induced changes in exchange rates will keep major currencies at equal strength. International reserves can then be kept in a number of these currencies, perhaps by selecting a basket of them that tends to minimize the risks associated with exchange rate fluctuations.
There are, however, important advantages to having a single principal reserve asset for a regional economy or the whole world economy. A single reserve asset can exert a unifying and integrating influence on the multinational economy it serves, just as a single national currency unifies and integrates a national economy.
Moreover, the existence of a principal reserve asset allows, in my opinion, a greater range of options with respect to international monetary arrangements. The multicurrency reserve system can, in practice, function only in conjunction with a floating exchange rate regime. The existence of a principal reserve asset is compatible with floating but also with other exchange rate regimes, including a system of fixed par values. A reserve system with a principal reserve asset is, therefore, a more versatile reserve system.
Finally, I believe that a widely accepted and used principal reserve asset can provide an anchor for currencies orienting themselves on its central value and can thus be a source of international economic and financial stability. In a world where economic power is becoming less concentrated, no single national currency may be in a position to play the role of the principal reserve asset.
If a return to the gold standard can be excluded, these reflections point to the possibility of an enhanced role for the SDR or a similar medium as a principal reserve asset in the world economy of the future. The second general question that I would like to mention has to do with the role of private transactions in the evolution of an international monetary asset.
Both papers presented at this session by Messrs. Coats and Giovanoli suggest the importance in this evolution of the establishment of a broad private basis for generating and holding such an asset and for engaging in a wide range of useful transactions denominated in it.
Only such a development can save an asset like the SDR from the fate of Esperanto as an international language. The reason why it is not worthwhile to learn Esperanto is that very few other people have learned it. Learning English or Spanish provides access to many more conversation partners or news media, and to a vastly greater literature, than does learning Esperanto.
And that demand will grow only if the usefulness of SDR holdings increases. I agree with Mr. Both Mr. Giovanoli and Mr. While the private ECU has flourished and continues to do so, the private SDR, after a promising start in the early s, has not been able to sustain its momentum and has, indeed, shown a retrograde development in recent years.
A number of reasons may account for the difference in the evolutions of these two assets, which are in many respects quite similar. Differences in currency composition—with the ECU being a more distinct alternative to the U. But an important part of the explanation is likely to be the active support given to the development of the private ECU by the EC and its members, both directly and indirectly through financial institutions with which they are in close contact, particularly the BIS.
By contrast, the Fund and its members have not gone out of their way to support the development of the private SDR—for instance, by providing a clearing mechanism—but have viewed such a development from a neutral vantage point, or perhaps even with some suspicion. In fairness, it should be said that the lack of support at the Fund for more rapid progression of the SDR toward becoming the principal reserve asset in the international monetary system appears to indicate a failure at the political level, not an absence of vision and effort at the staff level.
Indeed, staff work may be credited with maintaining pressure for the steady, if slow, progress that has been made in improving the quality and usability of the SDR. Further improvements may in time ensue. This brings me to the last issue discussed in Mr. In this process the SDR started far behind, with many restrictions on its use and with a low interest rate—originally set at 1.
Although many restrictions have already been removed and the SDR interest rate has been raised to the level of market interest rates on short-term assets denominated in the five currencies contained in the SDR valuation basket, there may still be some way to go to achieve full competitiveness. Improvement in the SDR has, understandably, proceeded in small steps. In his paper, Mr.
Coats describes recent progress and addresses two further steps that could be considered: first, removal of a present competitive disadvantage of the SDR in the event that payment of currency for SDRs in a transaction by agreement is delayed and, second, certain improvements in forward operations in SDRs. I shall comment on these two topics in turn. Coats reports that for late payment of the currency portion of a sale of SDRs for currency agreed between two parties, it is intended to require compensation of the injured party in accordance with the straightforward method customary in foreign exchange transactions.
This compensation is based on the thought that, for the duration of the delay in payment, the injured party would have to bear the cost of borrowing the currency it had failed to receive, but that it would still receive interest on the asset to be delivered by it and retained in its possession during the delay.
For SDR transactions, this means that the party making the late payment of currency must compensate the injured party for the excess, if any, in the interest on the currency that should have been delivered over the interest on the equivalent SDR balance. It should be noted that in the calculation of a fair compensation for late payment, any change in the exchange rate between the SDR and the currency in question in the interval between the agreed value date and the date of actual consummation of the transaction is completely irrelevant.
The rule specifies the use of the exchange rate three or two business days prior to the value date. When the agreed and actual value dates differ because of a late currency payment, the reference to the value date without adjective in Rule P-6 must be interpreted to mean agreed value date. Nothing in the language of this rule appears to stand in the way of such an interpretation.
The use of an exchange rate related by Rule P-6 to a delayed actual value date would impose an arbitrary and unwanted exchange rate on the agreeing parties—an obvious absurdity in the context of a voluntary contract.
With regard to forward operations in SDRs, two aspects are of particular interest. First, the parties are free to agree on a forward exchange rate for the agreed transaction. This freedom to negotiate a price, and through numerous such negotiations to establish a market price, for the SDR in forward operations may provide a useful vent for adjustment of the SDR to market pressures. At present, both the spot price of the SDR in terms of currencies and the SDR interest rate are calculated by fixed formulas.
In general, market assets must be able to adjust by means of changes in either the price or the interest yield in order to remain marketable.
The freely agreed forward price of the SDR may supply the needed flexibility. For this reason, I am less than enthusiastic about Mr. It may not be harmful to publish such calculations as guidelines, provided it is clear that the transacting parties may agree on different forward rates. The second issue arising in the context of forward operations in SDRs concerns the possibility of using the mechanism of forward operations for fixing SDR interest rates for periods longer than the present one-week span for which these rates are calculated.
Here I come down on the side of greater Fund initiative. The Fund might well contribute to the usefulness of the SDR by accepting fixed-term SDRdeposits of various maturities at interest rates oriented on the yield curves of the five component currencies.
I also agree with Mr. Coats on the desirability of the Fund helping to make a market for forward SDRs in the manner already implemented for spot transactions in SDRs. These lecture notes have no official character and merely reflect the views of the author expressed in All Rights Reserved. Topics Business and Economics. Banks and Banking. Corporate Finance. Corporate Governance. Corporate Taxation. Economic Development.
Economic Theory. Economics: General. Environmental Economics. Exports and Imports. Finance: General. Financial Risk Management. Foreign Exchange. Industries: Automobile. Industries: Energy. Industries: Fashion and Textile. Industries: Financial Services. Industries: Food. Industries: General. Industries: Hospital,Travel and Tourism. Industries: Information Technololgy. Industries: Manufacturing. Industries: Service. Information Management.
International Economics. International Taxation. Investments: Bonds. Investments: Commodities. Investments: Derivatives. Investments: Energy. Investments: Futures. Investments: General. Investments: Metals. Investments: Mutual Funds. Investments: Options. Investments: Stocks. Islamic Banking and Finance. Money and Monetary Policy.
Natural Resource Extraction. Personal Finance -Taxation. Production and Operations Management. Public Finance. Real Estate. Sustainable Development. Urban and Regional. Cloud Computing. Computer Science. Data Processing. Data Transmission Systems. Internet: General. Management Information Systems. Web: Social Media. Health and Fitness. Diet and Nutrition. This is particularly helpful when searching on CSL for names that have been translated into English from non-Latin alphabet languages.
Downloadable files will be saved as csl-yyyy-mm-dd. CSL Downloadable Files. From this API, any company can build a search engine to quickly find names, aliases, and other screening information.
Department of Commerce — Bureau of Industry and Security. Contact the Bureau of Industry and Security. Contact the Bureau of International Security and Non-proliferation. Contact the Directorate of Defense Trade Controls. Contact the Office of Foreign Assets Control. There are many activities of banks which involve risk-taking, but there are few in which a bank may so quickly incur large losses as in foreign exchange transactions.
The risks inherent in foreign exchange business, particularly in running open foreign exchange positions, have been heightened in recent years by the increased instability of exchange rates. Consequently, the monitoring of these risks has become a matter of increased interest to supervisory authorities. The purpose of this note is to consider the prudential aspects of banks' foreign exchange activities. It is not directly concerned with the restrictions that countries may place on their banks' foreign exchange business for exchange control, monetary or other macro-economic reasons.
In exercising prudential control over this area of banks' activities, however, supervisory authorities need to take into account the role of the banks as "market-makers" in foreign exchange. This role has two aspects. Firstly, banks have to quote rates to their customers including other banks at which they stand ready to buy and sell currencies.
0コメント