- DNBulletin: Age effect depresses wage growth during economic revival
- The ageing of the population is having a structural upward effect on wage growth at the macro level. In addition to this, there is a cyclical age effect at play: during recessions, wage growth comes under upward pressure, while downward pressure occurs during economic upswings.
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- DNBulletin: Financial crisis widened price level differences in Europe, but not in the United States
- Price level dispersion in the euro area declined sharply since the 1960s, to a level comparable to the differences between US city regions. However, DNB research shows that price level dispersion in the euro area is increasing again, partly as a result of the financial crisis. This is an indication of incomplete economic integration.
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- DNBulletin: New European risk monitoring framework for alternative investment funds
- The European Systemic Risk Board (ESRB) today published a set of recommendations to address investment fund risks. The initiative comes in the wake of strong growth in the sector and indications that fund managers are assuming more risk. The ESRB is concerned about the use of leverage in funds, which means that investments are made with borrowed money or derivatives.
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- DNBulletin: Labour market flexibilisation linked to fall in labour income share
- A data analysis involving eight Dutch industries between 1996 and 2015 shows that the decline of the labour income share (LIS) coincides with increased labour market flexibilisation. The weaker negotiating position of workers on flexible contracts compared to that of employees on permanent contracts may explain this decline.
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- DNBulletin: Strong correlation between consumption and house prices in the Netherlands
- According to an international comparative analysis, the Netherlands is one of a group of countries with a relatively strong relationship between house prices and private consumption. The strength of this relationship mainly depends on the relative share of homeowners with a mortgage loan. This suggests that institutional differences between mortgage markets (e.g. in the tax treatment of mortgage interest rates) probably play a substantial role in explaining why the relationship between house prices and private consumption is so much stronger in some countries.
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- DNBulletin: Favourable growth prospects mitigate impact of rising interest rates on investment
- A DNB study has revealed that there is considerable variation in the degree to which firms adjust investment in response to changes in interest rates. Firms with favourable growth prospects in the medium term are less likely to reduce investment in the light of a rise in interest rates. Future rises in interest rates could therefore be accompanied by a relatively modest decline in investments, in light of the current favourable economic outlook for the euro area.
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- DNBulletin: European stress test demonstrates vulnerabilities of pension funds
- The Dutch pension sector remains vulnerable to financial market shocks, compared with other European countries. An analysis shows that an extremely adverse but not unimaginable scenario in the financial markets will have a major impact on the capital positions of Dutch pension funds. This is apparent from the results published today of the stress test conducted this year among European pension funds by EIOPA, the European supervisory authority for insurers and pension funds.
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- DNBulletin: Call for review of preferential treatment of sovereign exposures in the capital framework
Phasing out the current preferential treatment of sovereign exposures in the capital framework for banks is important particularly for Europe. The EU must now take the lead in responding to a discussion paper of the Basel Committee on Banking Supervision on this topic. The interconnectedness of banks and governments was one of the determining factors in the European sovereign debt crisis and its reduction must remain ongoing.
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- DNBulletin: Basel Committee completes post-crisis bank regulation reforms
- The Basel Committee on Banking Supervision today reached agreement on a new framework for calculating capital requirements for banks. This will create more uniformity in the ways in which banks calculate their capital buffers. We believe the agreement is an important milestone marking the completion of the reforms of the global bank regulation framework, ten years post-crisis.
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- DNBulletin: Small group of investment funds employ substantial leverage
Leveraged investment funds – whereby investors have to finance only a limited portion of the underlying value of investments – can amplify shocks on financial markets and result in losses for banks, insurers and pension funds. A new study by DNB and the ECB reveals that European funds which employ leverage through derivatives and loans exhibit stronger sensitivity to investor outflows following negative returns. The use of leverage among investment funds in the Netherlands is limited however, based on the analysis of data from some 1,400 investment funds by DNB's Statistics Division, and a new assessment framework does not indicate risks to financial stability. Nonetheless, a few hedge funds and overlay funds do employ substantial leverage. DNB will monitor these investment funds more closely, and together with the ECB will call for analysis and adequate management of the risks in the European sector for alternative investment funds (AIFs). In this respect, an important first step is to gain an insight into the use of leverage among investment funds in Europe.
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- DNBulletin: Innovatie in kredietverstrekking leidt tot nieuwe aandachtspunten voor financiële sector en toezicht
De omvang van de markt voor geautomatiseerde kredietverstrekking voor bedrijfsleningen is op dit moment nog zeer beperkt, maar groeit snel. Een verdere groei leidt tot nieuwe aandachtspunten voor de financiële sector en het toezicht. DNB ziet drie uitgangspunten voor een veilige groei van innovatie in de bedrijfsleningenmarkt: voldoende inzicht in kredietrisico’s, rekening houden met onzekere voorspelkracht van geavanceerde kredietrisicomodellen en een effectieve bescherming van kleinzakelijke kredietnemers.
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- DNBulletin: Accuracy of macroeconomic projections sensitive to cyclical fluctuations
The projections for the Dutch economy include significant prediction errors. One of the underlying reasons is an underestimation of the economy's cyclicity. Overall, projections are overly optimistic in the downward phase of the cycle and overly pessimistic in the upward phase. This phenomenon has a statistical as well as an economical cause.
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- DNBulletin: A closer look at inflation measures in the euro area and the United States
Adequately comparing inflation in the euro area with the US - which is required for example to compare monetary policy - involves taking into account the different ways of including owner-occupiers' housing costs in determining inflation. If these imputed housing costs are excluded, the inflation figures in the euro area and the US seem to have been slowly converging over the past few years.
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- DNBulletin: Increasing climate-related risks demand more action from the financial sector
- Financial institutions must increasingly factor in the consequences of a changing climate and the transition to a carbon-neutral economy. DNB explores the impact of climate-related risks on the Dutch financial sector in its recent report, "Waterproof? An exploration of climate-related risks for the Dutch financial sector". This impact can be felt increasingly strongly in a variety of areas, which is why DNB intends to embed climate-related risks more firmly in its supervision with the ultimate aim of ensuring sustainable financial stability.
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- DNBulletin: Dutch public positive about deposit guarantee scheme
Three quarters of the Dutch public are aware that deposits are guaranteed up to a certain amount in the event of bank failure. They are less familiar with the specific features of the Deposit Guarantee Scheme (DGS), such as the maximum payout deadline of 20 working days. A study commissioned by DNB shows there is still room for improvement, considering that greater awareness is essential to promoting confidence in the industry.
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