Aurelia Butler

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LONDON (Reuters) -The Bank of England on Wednesday said it would delay by six months to July 2025 its roll out of the final leg of international bank capital rules that began after the global financial crisis over a decade ago.The BoE’s Prudential Regulation Authority arm had indicated along with the European Union, that it would start implementing the rules, which were set out by the global Basel Committee of banking regulators, from January 2025.Instead, the BoE has decided to move in line with the United States, where the Federal Reserve has said it would start its roll out in July 2025.The BoE said this would give firms more time to get ready, and that it also intends to cut the transitional period for full implementation to 4.5 years to ensure full implementation by 1 January 2030.UK Finance, a banking industry body, said its members were already dedicating huge amounts of resources to preparing for the new rules.Typically banks need at least a year to prepare for implementing new rules once a final version has been published.”With this in mind, we would urge the Prudential Regulation Authority to finalise its requirements by Easter 2024, rather than mid-Summer, to give firms the certainty they need to plan effectively,” said Simon Hills, UK Finance’s director for prudential policy. The Bank has already held a public consultation on its proposals to implement the Basel rules and had been expected to issue final rules sometime in 2024.It has now changed its timetable.”In Q4 2023, we intend to publish the near-final policies on market risk, credit valuation adjustment risk, counterparty credit risk and operational risk,” it said in a statement.”In Q2 2024, we intend to publish the near-final policies on the remaining elements… credit risk, the output floor, and reporting and disclosure requirements.”Banks in Britain are pushing for changes to avoid being at a “competitive disadvantage” to banks in the European Union, where policymakers have agreed to temporary waivers and long phase-ins. U.S. banks are also pushing back against how the Fed intends to implement the so-called “Basel Endgame”. More

NEW YORK (Reuters) – Federal Reserve Bank of Minneapolis President Neel Kashkari said on Wednesday it is not clear yet whether the central bank is finished raising rates amid ample evidence of ongoing economic strength. Speaking on CNBC, Kashkari said he is not yet ready to say rates have been lifted enough to get inflation back to the 2% target. He said that he expects the U.S. central bank to hold rates steady next year after a likely final rate rise this year.Kashkari, who spoke in the wake of last week’s Fed meeting that left the central bank’s federal funds rate unchanged at between 5.25% and 5.5%, said the data will drive future central bank policy decisions. And he noted what is happening in the economy makes it unclear whether monetary policy is in a place to bring inflation down as quickly as it needs to come down. “One thing that makes me cautious that we might not be as restrictive as we think” is the strength of consumer spending coupled with still strong gains in overall economic activity, amid the resilience of the housing and auto sectors even in the face of much tighter monetary policy, Kashkari said. “We are allowing the data to come to us to try to figure out how much effect do we have in the economy and whether or not we need to do more” with rate policy, Kashkari said. In the Fed’s latest forecasts, officials continued to pencil in one more rate hike for this year, and said they expect the rates to be higher for longer given that the economy is performing more strongly than their expectations relative to the early summer. More

The remarks from the politburo, a top decision-making body of the ruling Communist Party, come a day after party inspection teams concluded investigations into dozens of state-owned enterprises.”(We) need to…promote those who do not dare to, cannot and do not want to (engage in) in corruption,” the Xinhua readout of the politburo meeting said.”The meeting emphasised that (we) should continuously enhance the…core competitiveness of state-owned enterprises, and…increase the efforts of financial enterprises to serve the real economy and national strategy.”The Chinese government has experienced a turbulent time with the disappearance of former foreign minister Qin Gang and defence minister Li Shangfu. The vanishing of officials in China is often followed by the announcement of investigations into suspected disciplinary infractions but Beijing has yet to explain why Qin and Li remain out of public sight.Qin has been missing for three months and Li for one month. With tensions over Taiwan, the South China Sea, and over U.S. export controls that target the Chinese military and advanced tech sector, Xi’s rule has been marked by a focus on national security risks within the party, government, and large industries.”It is necessary to…establish a mentality of red lines and (willingness) to be extreme, take effective measures to prevent and resolve major risks, and firmly maintain the bottom line of safety,” the politburo was quoted as saying. More