Bank of Italy has released six new Occasional Papers:
- No. 685 – Regional inequality in Italy in the face of economic crises, recovery, and the health emergency;
- No. 684 – The banking system and the financing of southern Italian firms;
- No. 683 – Italian economic growth and the North-South gap: historical trends and future projections in light of the recent demographic scenarios;
- No. 682 – The digital transformation in the Italian banking sector;
- No. 681 – An epidemic model for SARS-CoV-2 with self-adaptive containment measures;
- No. 680 – The level of digitalization of Italy’s local administrations: North-South differences.
The letter discusses the current outlook for financial stability and sets out the FSB’s plans over the coming months to assess and address emerging vulnerabilities.
The letter notes that the Russian invasion of Ukraine triggered large price fluctuations in global financial markets. Thus far, the global financial stability impact of the war in Ukraine appears limited compared to the turmoil induced by COVID-19 in March 2020.
Nevertheless, uncertainty remains high. Inflation is back, and with it (the prospect of) tighter financing conditions. This has the potential to crystallise vulnerabilities that have been building for some time, such as high debt levels in the non-financial sector and stretched valuations.
The letter flags a number of issues that warrant particular attention:
- linkages between commodity markets and the rest of the financial system;
- financial system leverage and possible amplifiers in the event of market stress; and
- cyber risks.
In addition, for many emerging market and developing economies heightened geopolitical tensions and rising energy and food prices are adding to the economic strain from COVID-19, reduced policy space and tightening global financial conditions.
Meanwhile, the Russia-Ukraine war has reinforced concerns about the growth and potential use of crypto-assets.
The European Investment Bank (EIB) has published the fourth edition of its climate survey.
The survey shows that a majority of Europeans are confident that climate policies will improve their quality of life and create jobs.
In particular, the survey shows that a majority of Europeans believe that:
The survey shows that a majority of Europeans are confident that climate policies will improve their quality of life and create jobs.
In particular, the survey shows that a majority of Europeans believe that:
- climate policies are a source of economic growth;
- policies to fight climate change will create more jobs than they eliminate;
- 61% think that climate policies will improve their quality of life;
- 25% fear losing their jobs because they will become incompatible with the need to mitigate climate change.
Key workstreams include:
- Sustainability – the development of the regulatory and supervisory framework for sustainability-related disclosures, including the delivery of two sets of draft Regulatory Technical Standards (RTS) under the Sustainable Finance Disclosure Regulation (SFDR);
- Digital finance – extensive technical discussions on topics such as crypto-assets and digital operational resilience;
- Consumer protection – work to prepare the response to the Call for Evidence from the European Commission in the context of the review of the PRIIPs Regulation, following the submission of the draft RTS in January 2021; and
- Securitisation – the delivery of a report on the implementation and functioning of the Securitisation Regulation as well as an Opinion on its jurisdictional scope.
