Financial Stability News

Flashing news about financial stability and central banking

EU Red-Flags ‘Volcker’

Latest news from Davos where commissioner Barnier stated that EU (like Japan and Canada before him) is concerned with the fallout from the introduction of the Volcker rule in the US on foreign debt markets. As noted in earlier posts, the administration in the US is not to eager on the Volcker rule either, which tries to prohibit trades done with the intent of making money. So, while the UK Treasury seem intent of going ahead with its variant of the Volcker rule (ring fencing the retail part of big banks), the US Treasury (and US banks) is getting surprising support for delaying the policy measure. The proposal is still out for hearing, but given the strong international reaction, my guess is it will remain out for hearing for quite some time.

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