BIS Quarterly Review, September 2019

Starting in May, prices of risky assets seesawed in response to unexpected turns in trade policy and adjustments to monetary policy. The rally in equity and credit markets seen in early 2019 reversed course in May on the prospect of higher tariffs on US-China trade and US imports from Mexico. ...

The BIS has expanded the details that it publishes about banks' balance sheet linkages with non-bank counterparties. These additional details show that banks have increasingly large positions vis-à-vis the non-bank financial sector. ...

Central banks' frameworks for managing foreign exchange reserves have traditionally balanced a triad of objectives: liquidity, safety and return. Pursuing these objectives involves explicit trade-offs. Recently central banks have shown interest in incorporating environmental sustainability objectives into their reserve management frameworks. ...

Purchasing managers' indices (PMIs) have found a place in global conjunctural analysis and quarterly GDP nowcasting, serving as reliable concurrent indicators of real economic activity. They also closely mirror changes in equity prices and corporate bond spreads. ...