Paolo Siciliani and Daniel Norris
Asset managers make it more convenient for savers to diversify their investments in stock markets. They are also in a better position to monitor the managers of firms in their portfolios, even if they adopted a passive investment strategy. However, it has been argued that competition might be weakened when firms competing in concentrated industries, such as airlines, share the same small number of institutional investors as their top shareholders.
Changes in Bank Rate and other monetary policy instruments feed through to the real economy by various channels – including the rates of interest for borrowers and savers. But in practice, there are many of these “interest rates” depending on the type of product, who is borrowing/saving, and on what terms. The Bank has recently published a new range of interest rate statistics that help policymakers, researchers and the general public better understand how policy changes feed through to household and firms in the economy. Over the next four days, we’ll publish a bitesize post a day highlighting a different interest rate series and thinking about what it might mean for monetary conditions.
Julia Giese and Matt Roberts-Sklar.
Government bond yields rose sharply in the UK in October 2016, following increased concerns about ‘hard Brexit’, and in the US since the presidential election in early November 2016. This chart puts these increases into historical perspective: moves in 10-year UK gilts and 10-year US Treasuries were of a similar magnitude to the 2013 US ‘taper tantrum’, the 2015 German ‘bund tantrum’, as well as in the so-called ‘bond massacre’ during the US 1994 tightening cycle.
Continue reading “Bitesize: Tantrums, massacres and bond market reversals”
Ian Billett and Patrick Schneider.
As time goes to infinity, the probability that a productivity analyst will wonder ‘which sectors are driving these trends?’ goes to one. We present an interactive sectoral productivity tool to help you explore this question without any fuss.
Continue reading “Bitesize: Exploring UK sectoral productivity”
Matt Roberts-Sklar.
In a previous post I showed that bond and equity returns are negatively correlated, having been positively correlated for most of the 18th-20th centuries. The time series was long (three centuries) and the chart was just for the UK, prompting two very reasonable questions: 1) does your story hold for countries other than the UK? and 2) what’s happened to this correlation recently?
Continue reading “Bitesize: More on the bond-equity correlation”
Peter Eckley and Liam Kirwin.
In the world of bank capital regulation, minimum requirements grab all the headlines. But actual capital resources are what absorb unexpected losses. Banks and building societies typically hold resources substantially in excess of requirements – called the capital surplus. One reason is to avoid breaching the minimum due to unforeseen shocks. Another is to build resources in anticipation of requirements arising from growth or regulatory change. The chart shows how capital surpluses (on total requirements including Pillars 1 and 2, and all types of capital) have varied in recent decades. It is based on historical data from regulatory returns.
Continue reading “Bitesize: Banks’ growing capital surplus since the crisis”
Alexander Naumov.
“Too slow for too long”, referring to global GDP growth, was the title of a recent IMF publication. But is world economic growth really that slow? Looking at the data over the past several decades, global growth since the crisis does not appear particularly weak; at least not in a historical perspective
Continue reading “Bitesize: Global growth: The *old* normal?”
John Lewis.
Macroeconomists like to use US data to test and develop theories- the coverage is generally very good, and the world’s largest economy is an obvious benchmark. But what if the US happens to be very atypical in some respects? For example the evolution of the income distribution…
Continue reading “Bitesize: America is not always like the rest of the world”
Dan Wales and Emil Iordanov.
Have FOMC discussions changed since the end of 2015? Are the committee more concerned about international risks now?
Continue reading “Bitesize: Has the FOMC increased its focus on foreign risks?”
Christopher Hackworth, Nicola Shadbolt and David Seaward.
While official housing market statistics are relatively timely and high frequency, they usually come with a lag of at least one month. So indicators that lead official estimates are helpful for identifying turning points, or any ‘shocks’ to the economy.
Continue reading “Bitesize: Understanding housing activity in real time”
