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European macroprudential policy from gestation to infancy

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  • Angeloni, I.

Abstract

The launch of the Single Supervisory Mechanism and the new European legislation on micro and macroprudential instruments (Capital Requirements Directive IV and Capital Requirements Regulation) open important new prospects for banking supervision in Europe. This article reviews opportunities and challenges created by these changes. The new policy framework should decisively contribute, over time, to financial stability in the continent, also by providing tools to address country specific macrofinancial developments that are not easily tackled in a single currency area. For this to happen, it is essential that actions by the European Central Bank and by the national authorities be effectively coordinated. Micro and macroprudential instruments should coherently focus on promoting financial stability. Credit micro-management, influencing the sectorial allocation of credit or reintroducing a national dimension in monetary control, should be avoided. Moreover, the analytical base of macroprudential policy is still partially developed; more work and experience are needed before macroprudential policy can occupy a central role in the European economic policy landscape.

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  • Angeloni, I., 2014. "European macroprudential policy from gestation to infancy," Financial Stability Review, Banque de France, issue 18, pages 71-84, April.
    • Handle: RePEc:bfr:fisrev:2014:18:08
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    References listed on IDEAS

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    Cited by:

    1. van Riet, Ad, 2015. "Market-preserving fiscal federalism in the European Monetary Union," MPRA Paper 77772, University Library of Munich, Germany.
    2. van Riet, Ad, 2016. "Safeguarding the euro as a currency beyond the state," Occasional Paper Series 173, European Central Bank.
    3. Ad Van Riet, 2017. "A New Era For Monetary Policy: Challenges For The European Central Bank," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 62(01), pages 57-86, March.
    4. Ermanno Catullo & Antonio Palestrini & Ruggero Grilli & Mauro Gallegati, 2018. "Early warning indicators and macro-prudential policies: a credit network agent based model," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 13(1), pages 81-115, April.

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