Invested: The OMFIF Podcast

A fundamentally weak pound is not the best platform on which to base uncertainty about the Bank of England’s future. But, barring the withdrawal of independence, there are – after 25 years of the Monetary Policy Committee – real opportunities to make new UK Prime Minister Liz Truss’ review constructive. It must be thorough, non-political and not drag on. Uncertainty in the meantime may put even greater pressure on the MPC to accelerate rate hikes and go harder on quantitative tightening. And, if that exacerbates stagflation, Truss may not get the full-blown recovery she needs before the next general election.

So, what are the issues, what are the most feasible options and where do we go from here? Neil Williams, chief economist, and Taylor Pearce, economist, OMFIF, discuss.

For more, see https://www.omfif.org/2022/09/options-for-truss-to-preserve-the-bank-of-englands-independence/

 

Japan is committed to achieving carbon neutrality by 2050 and reducing greenhouse gas emissions by 46% by 2030. To do so, the country has focused on developing transition finance, an approach designed to support polluting companies that are trying to reduce their carbon footprints. Satoshi Ikeda, chief sustainable finance officer at Japan’s Financial Services Agency, spoke with Katerina Atkins, programme coordinator of OMFIF’s Sustainable Policy Institute. They discussed Japan’s approach to sustainable finance and regulatory practice, guidelines for climate transition finance, transition bond issuance and preventing greenwashing.

Algorand, a blockchain company and central bank digital currency platform, join the Digital Monetary Institute’s editor, Lewis McLellan, to discuss the latest trends in CBDC development. Naveed Ihsanullah, vice-president of engineering research, Pietro Grassano, business solutions director for Europe, and Co-Pierre Georg, associate professor at the University of Cape Town and member of Algorand’s economic advisory committee, share their thoughts on some of the key themes in CBDCs: decentralisation, monetary sovereignty, privacy and financial inclusion. Many of their insights are drawn from their 2022 report, ‘Issuing Central Bank Digital Currency on Algorand’.

Dave Sissens, chief executive officer of RTGS.Global, sits down with the Digital Monetary Institute’s editor, Lewis McLellan, to discuss the possibilities for improving the quality of the infrastructure underpinning cross-border payments. They discuss the role that RTGS.Global’s platform could play in the future of the wholesale foreign exchange settlement ecosystem and how it might integrate with other payments systems, including CBDCs. They cover payment versus payment settlement, the removal of counterparty risk, the role of decentralisation and what the payments landscape will look like over the next five to 10 years.

Regulation and disclosure requirements for the financial sector are on the rise, and commitments to the net zero transition are increasing. Daniel Bouzas Luis, regional coordinator for Europe at the United Nations Environment Programme Finance Initiative, speaks with Emma McGarthy, head of OMFIF’s Sustainable Policy Institute, about the development of UN-convened net zero alliances, the role of European institutions in the global sustainability transition and the European Union’s green taxonomy. They discuss commitments, successes and challenges for sustainable finance, including closing data gaps and increasing disclosure frameworks.

Larissa De Lima, senior fellow at the Oliver Wyman Forum, and Erica Salinas, global technical leader for blockchain at AWS, join Lewis McLellan, editor of OMFIF’s Digital Monetary Institute, to discuss their joint report, 'Retail Central Bank Digital Currency: From Vision to Design'. They delve into the importance of clear strategic priorities when it comes to designing a CBDC for retail use. Some jurisdictions will aim to prioritise the impact on financial inclusion that introducing a retail CBDC will have. Others will be more concerned with ensuring the privacy and data security of the users. De Lima and Salinas discuss policy trade-offs that CBDCs will have to grapple with, accepting compromises based on their priorities. The range of priorities is broad, and each possibility implies a different technical architecture.

Wolfram Seidemann, chief executive officer of G+D Currency Technology, joins John Orchard, CEO of OMFIF, for a discussion on how the recent crypto crash may influence government policy regarding central bank digital currencies. They touch on the importance of security and interoperability within the payments landscape.

Simon Chantry, Bitt’s co-founder and chief information officer, and its new economist Jim Shinn, a former US government official and member of the Criteo central bank digital currency team that was one of the three winners of the Monetary Authority of Singapore’s global CBDC challenge in 2021, join DMI editor Lewis McLellan. They discuss Bitt’s experience in deploying CBDC protocols, key themes emerging in retail CBDC development and the geopolitical pressures underpinning them.

The European Central Bank has established a supervisory climate risk stress test to better understand banks’ capabilities, risk metrics, long-term risk projections and parameters in physical and transition risk scenarios. Christoffer Kok, head of the stress test modelling division of the ECB's directorate general for macroprudential policy and financial stability, joins Emma McGarthy, head of OMFIF’s Sustainable Policy Institute, to discuss the results of the stress test, approaches and methodologies taken and lessons learnt.

Melvin Khomo, general manager for financial markets at the Central Bank of Eswatini, joins Dieter Sauter, general manager of the business unit value printing at Bundesdruckerei, and Lewis McLellan, editor of the Digital Monetary Institute, to discuss what advantages a central bank digital currency can deliver. The importance of a robust means of digital identity verification as a means of improving financial inclusion as well as part of the foundation for digital currency infrastructure and the importance of creating a robust, secure platform that citizens will feel confident in adopting are also covered.