Money, capitalist market societies' paramount contract, relies on the belief in its enduring value. However, we still know surprisingly little about the social foundations that sustain that belief. How is our collective trust in the enduring value of money socially built, and what happens if...

We field a series of experiments in a population-representative survey of European consumers to examine their attitudes towards the possible introduction of a digital euro. First, we show that a short video explaining the key features of the digital euro is effective in changing consumers'...

We investigate the interaction between monetary and macroprudential policy in affecting banks' lending and risk-taking behaviour using rich euro area credit registry data and exploiting a unique setting that combined a sharp and unexpected monetary tightening with a wave of macroprudential...

Word embeddings are vectors of real numbers associated with words, designed to capture semantic and syntactic similarity between the words in a corpus of text. We estimate the word embeddings of the European Central Bank's introductory statements at monetary policy press conferences by using a...

The pros and cons of CBDCs have been examined in numerous writings but much less research has focused on specific economies or regions. This paper attempts to fill that gap for the Latin American and Caribbean (LAC) economies. It first examines the views of central banks in the region toward...

Monetary authorities globally have studied central bank digital currency (CBDC) for wholesale and retail applications since the 1990s. Besides countering private cryptocurrencies' influence, central banks have also explored other benefits of CBDC, such as improving their financial oversight,...

The monetary policy of the People's Bank of China (PBoC) during 2001-2023 is assessed in terms of Taylor and McCallum rules, as well as a proposed composite monetary policy rule. PBoC policy is found to be responsive to the gap between target and actual nominal GDP in the McCallum rule, as well...

Recent crises have cast doubt on the legitimacy of technocratic power, yet its role in global economic governance remains poorly understood. Revisiting the collapse of Bretton Woods, we propose a dynamic theory of global monetary governance to explain how expanding central bank discretion can...

The evidence of financial globalization and the rapid and uniform contagion that it entails among the different international financial markets, have been exposed after the 2008 crisis outbreak, as well as the different chapters of financial stress that have been experienced since then, such as...

In the Hellenistic era, there was widespread convergence to the Attic standard and a similar narrowing of coin types in terms of aesthetics. The competition between issuers resulted in an equilibrium in which improvements to the consistency and quality of money were sought after. This...

The motivations and benefits of issuing a central bank digital currency (CBDC) are well known but the challenges faced by central banks in developing and issuing a CBDC have received less attention. To fill this gap, this article provides a succinct understanding of how politics hinder CBDC...

Over the last decade, monetary policy frameworks and instruments have undergone significant modifications. In this regard, Central Bank Digital Currency (CBDC) has emerged as a new money invention to offset the advancement of cryptocurrencies and maintain central ability to distribute cash as a...

This paper examines the role of foreign exchange reserve demand in mitigating inflationary pressures resulting from money supply growth in reserve currency issuing states (RCISs). Despite recurrent substantial monetary expansions in RCISs in response to recessions such as the 2000 Post-Dot Com...

Digitalization of the global economy, catalysed by advancements in blockchain technology and the rise of cryptocurrencies, has led to a paradigm shift in the monetary landscape. Central Bank Digital Currencies (CBDCs) have emerged as a transformative force with the potential to revolutionize...

We combine modern methods from Speech Emotion Recognition and Natural Language Processing with high-frequency financial data to precisely analyze how the vocal emo- tions and language of ECB President Mario Draghi affect the yields and yield spreads of major euro area economies. This novel...

How can a currency achieve more widespread international use? We study the internationalization of the Chinese renminbi (RMB) through the lens of a unique policy experiment in Argentina. In 2023, amid a severe dollar shortage, Argentina expanded a currency swap line with the People's Bank of...

This paper examines consumers' intended adoption of a digital euro in Austria using a discrete choice experiment. We estimate a mixed logit model to quantify the role of key attributes such as privacy, offline functionality, security against financial loss, monetary incentives, and payment form...

One of the main goals of launching the EU's second Markets in Financial Instruments Directive (MiFID II) and the respective Markets in Financial Instruments Regulation (MiFIR) was to increase the transparency of transactions in financial markets. Prior to MiFID II, transparency requirements in...

We introduce a summary indicator based on the Canadian Survey of Consumer Expectations (CSCE). This indicator provides a summary measure of consumer opinions that we can track over time. We construct three underlying indexes-financial health, labour market and consumer spending-that capture...

We examine how speeches by Federal Open Market Committee (FOMC) members, including regional Fed presidents, shape private sector expectations. Speeches that signal rising inflationary pressures prompt both households and professional forecasters to raise their inflation expectations, consistent...

The management report is an integral part of the ECB's Annual Accounts and is designed to provide readers with contextual information related to the financial statements. Given that the ECB's activities and operations are undertaken in support of its policy objectives, the ECB's financial...

The euro area experienced an unprecedented surge of inflation in 2021 and 2022 followed by a decline in 2023 and 2024. The ECB raised policy rates too late. Simple rules would have prescribed an earlier response. The policy easing since summer 2024, however, is quite in line with such rules....

This briefing report evaluates the ECB's monetary policy in a context of declining inflation and stagnant growth. Inflation risks have been averted and, after a period of relatively tight policy in 2024, benchmark comparisons indicate that the current interest rate is consistent with the ECB's...

This briefing report evaluates the ECB's monetary policy in a context of declining inflation and stagnant growth. Inflation risks have been averted and, after a period of relatively tight policy in 2024, benchmark comparisons indicate that the current interest rate is consistent with the ECB's...

The euro area experienced an unprecedented surge of inflation in 2021 and 2022 followed by a decline in 2023 and 2024. The ECB raised policy rates too late. Simple rules would have prescribed an earlier response. The policy easing since summer 2024, however, is quite in line with such rules....

This paper investigates the impact of reforms altering legal central bank independence (CBI) on monetary policy discipline and credibility, two key mechanisms shaping price stability. Using a sample of 155 countries over more than 50 years (1972-2023), we show that reforms improving CBI...

Private money creation lies at the heart of currency competition due to seigniorage rents that are an important contributor to banks' franchise values. However, it undermines the role of central bank in money provision and has been historically a contentious issue. As shifting from private to...