The Macroprudential Policy Framework Needs to Be Global

Lopez, Claude and Bruni, Franco (2019): The Macroprudential Policy Framework Needs to Be Global.

Abstract

Basell III was a direct answer to the 2008 financial crisis. Now 10 years after the crisis, it is time to assess its timeliness and make the necessary adjustments so it becomes truly global. In this policy brief, we first clarify the goals of macroprudential policy before highlighting the main challenges that home and host countries may run into when global financial institutions lend beyond their home countries. We then suggest to focus on four priorities to address these vulnerabilities: (i) An adaptable and flexible global framework, (ii) The generalization of international standards and best practices, (iii) A stronger global data depository, (iv) Regulatory and monitoring cooperation.

• Item Type: MPRA Paper
• Language: English
• Keywords: macroprudential policy, G20
• Subjects: E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook; F - International Economics > F5 - International Relations, National Security, and International Political Economy; F - International Economics > F6 - Economic Impacts of Globalization

References

Adams-Kane Jonathon and Claude Lopez (2019), Global Opportunity Index 2018: Emerging G20 Countries and Capital Flow Reversal, Milken Institute Report.

Bruni, Franco and Claude Lopez (2019), Monetary Policy and Financial System Resilience, T20 recommendation.

FSB (2018), Implementation and Effects of the G20 Financial Regulatory Reforms, Fourth Annual Report, FSB report.

FSB (2019), FSB work programme for 2019, FSB publication. IMF-FSB-BIS (2016), Element of Effective Macroprudential Policy, IMF-FSB-BIS report.

Lopez, Claude, Jonathon Adams-Kane, Elham Saeidinezhad and Jakob Wilhelmus (2018), Macroprudential Policy and Financial Stability: Where Do We Stand?, Milken Institute Report.

Lopez, Claude and Elham Saeidinezhad (2017), Central Counterparties Help, But Do Not Assure Financial Stability, Milken Institute Report.