Latest news with #HyunSongShin
CNA
11-07-2025
- Business
- CNA
Trade tensions, heightened uncertainty cloud the outlook for growth: BIS
Hyun Song Shin, Economic Adviser and Head of the Monetary and Economic Department of the Bank for International Settlements - the world's leading central bank umbrella group - underscores the impact of policy uncertainty and tariffs in weakening global economic activity.
TimesLIVE
30-06-2025
- Business
- TimesLIVE
World economy faces ‘pivotal moment', central bank body BIS says
The BIS' annual report, published on Sunday, is viewed as an important gauge of central bankers' thinking, given the Switzerland-based forum's regular meetings of top policymakers. Rising protectionism and trade fragmentation were 'particular concerning' as they were exacerbating the decades-long decline in economic and productivity growth, Carstens said. There is also evidence the world economy is becoming less resilient to shocks, with population ageing, climate change, geopolitics and supply chain issues contributing to a more volatile environment. The post-Covid-19 spike in inflation also seems to have had a lasting impact on the public's perception about price moves, a study in the report showed. High and rising public debt levels are increasing the financial system's vulnerability to interest rates and reducing governments' ability to spend their way out of crises. 'This trend cannot continue,' Carstens said, referring to the rising debt levels, and he said higher military spending could further push up the debt up. Hyun Song Shin, the BIS's main economic adviser, also flagged the sharp fall in the dollar. It is down 10% since the start of the year and on track to be its biggest H1 drop since the free-floating exchange rate era began in the early 1970s. He said there was no evidence this was the start of a 'great rotation' away from US assets as some economists have suggested, but acknowledged it was too early to know as sovereign funds and central banks move slowly. Shorter-term analysis, though, showed 'hedging' by non-US investors holding Treasuries and other US assets appears to have made an 'important contribution' to the dollar's slide over the past few months. 'We haven't seen anything (yet) that would give us any cause for alarm,' Shin added. The BIS published one part of its report last week that gave a stark warning about the rapid rise of stablecoins. In terms of the BIS' own finances, it said it made a net profit of 843.7m IMF SDR (R21.3bn), while its total comprehensive income reached a record high of SDR 3.4bn (R94.2bn) and currency deposits at the bank also reached a new high. Carstens said: 'It is important the BIS has the highest creditworthiness out there.'
Yahoo
29-06-2025
- Business
- Yahoo
'Unmoored' inflation expectations could be huge shock to global economy, warns BIS
The risk that inflation expectations could pose to the global economy amidst the ongoing trade uncertainty should not be underestimated, warns the Bank for International Settlements (BIS). 'Inflation expectations are very sensitive right now, and they could really jump if inflation were to be realized,' Hyun Song Shin, an economic adviser at the institution and author of its 2025 Annual Economic Report released Sunday, said. 'That's the kind of risk we're facing.' For one thing, trade uncertainty is impacting global supply chains, which could lead to potential trade disruptions and a temporary shortage of some goods. 'As witnessed during the pandemic, such disruptions can have significant and long-lasting ramifications for production and prices across the economy,' the report said. Shin said the pandemic and subsequent inflation left a deep imprint on most respondents the BIS recently surveyed in 29 advanced and emerging market economies. On average, the households surveyed expect inflation to be about eight per cent over the next 12 months. 'Once inflation expectations are unmoored, then that has a huge persistent shock,' he said. BIS said the growth outlook for the global economy has also been impacted by tariffs, with global gross domestic product (GDP) expected to come in at 2.7 per cent in 2025 and only a little higher in 2026. 'These forecasts are around a quarter of a percentage point lower than expectations at the start of 2025,' the report said. The expected slowdown in growth has translated into slowing business investment and complicates the future path of productivity in most countries. The BIS also warns there are risks associated with high sovereign debt levels. 'While higher public debt levels can be sustainable in the presence of strong income growth and low interest rates, current and future conditions look less favourable,' the report said. The growing interconnectedness of the global financial system and the increasing footprint of non-financial banking institutions (NFBI) have also posed significant new challenges for financial stability. Shin said leveraged hedge funds and portfolio managers are playing a more central role in what's happening in the global market and that is changing the risk landscape. 'The types of risks are much more about what could happen when there is sudden selling, what's going to happen to prices,' he said. Recent examples include the 2022 United Kingdom mini-budget selloff and the U.S. regional bank selloffs in 2023. 'We're facing a different set of risks from the ones that we're used to, for which the current surveillance mechanisms have been built up,' Shin said. 'It's fair to say that most of our surveillance networks are very much based on the experience during the global financial crisis.' The report said the total assets held by NFBIs surged to 224 per cent from 167 per cent of global GDP between 2009 and 2023, while the growth in banks' total assets during the same period grew to 177 per cent of global GDP from 164 per cent. Shin said that doesn't mean regulators and policymakers should take their eyes off the big banks, but additional regulatory measures should be considered to reflect the expanded role other financial intermediaries are playing in the market. 'Enhancing regulatory standards to keep pace with the evolving structure of global financial markets is critical to ensure the resilience of the financial system,' the report said. Bank of Canada's inflation worries linger Bank of Canada hoping for better look at 'complicated' inflation picture • Email: jgowling@ Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Zawya
24-06-2025
- Business
- Zawya
Central bank body BIS delivers stark stablecoin warning
The Bank for International Settlements issued its starkest warning yet on the risks posed by stablecoins and urged countries to move rapidly towards the tokenisation of their currencies. The BIS, often dubbed the central bankers' central bank, outlined its concerns, including stablecoins' potential to undermine monetary sovereignty, transparency issues and the risk of capital flight from emerging economies. It comes less than a week after the U.S. Senate passed a bill to create a regulatory framework for U.S.-dollar-pegged stablecoins, a move which, if rubberstamped by the House, is expected to fuel a further explosion in their popularity. Stablecoins are a type of cryptocurrency designed to maintain a constant value, usually a 1:1 dollar peg, backed by real-world assets such as U.S. Treasuries or gold. Dollar-pegged coins currently account for 99% of the market, which is estimated to have over $260 billion worth of coins in circulation. "Stablecoins as a form of sound money fall short, and without regulation pose a risk to financial stability and monetary sovereignty," BIS said in a early-released chapter of its annual report due to be published on Sunday. Hyun Song Shin, the BIS' Economic Adviser, explained that stablecoins lack the traditional settlement function provided by a central bank with fiat money. He likened them to private banknotes circulating in the 19th-century Free Banking era in the United States. It means they can often trade at varying exchange rates depending on the issuer, undermining the no-questions-asked principle of central bank-issued money. "Singleness is either you have it or you don't," Shin said, also warning of the risk of "fire sales" of the assets backing stablecoins if they collapse, as TerraUSD (UST) and the cryptocurrency LUNA did in 2022. There is also the concern around who controls stablecoins. Tether currently has more than half of the overall stablecoin market, but quit the EU following the introduction of new rules which require stablecoin operators to be licensed by the bloc. "The whole question of disclosure, this is where some of the stablecoins differ," BIS Deputy General Manager Andrea Maechler said. "You will always have the question about the quality of the asset backing. Is the money really there? Where is it?" BOLD ACTIONS The BIS wants central banks to go down the route of tokenised "unified ledger" incorporating central bank reserves, commercial bank deposits and government bonds. It would mean central bank money remains both the primary means of global payment and that currencies and bonds from around the world could effectively be integrated into the same "programmable platform". Tokenisation is aimed at creating a digitalised central bank system that settles payments and securities trades almost instantaneously and more cheaply by cutting the need for certain time consuming checks, as well opening up new functionality. It can also make the system more transparent, resilient and interoperable and may protect the system from some of the more unpredictable elements of cryptocurrencies. There would be a number of key issues to overcome, including who gets to set the rules governing the platform and that individual countries are likely to want to retain significant control of how and who uses their currencies. "Realising the full potential of the system requires bold action," the outgoing head of the BIS, Agustin Carstens, said.
The Star
24-06-2025
- Business
- The Star
Central bank body BIS delivers stark stablecoin warning
FILE PHOTO: The tower of the headquarters of the Bank for International Settlements (BIS) is seen in Basel, Switzerland March 18, 2021. REUTERS/Arnd Wiegmann/File Photo LONDON (Reuters) -The Bank for International Settlements issued its starkest warning yet on the risks posed by stablecoins and urged countries to move rapidly towards the tokenisation of their currencies. The BIS, often dubbed the central bankers' central bank, outlined its concerns, including stablecoins' potential to undermine monetary sovereignty, transparency issues and the risk of capital flight from emerging economies. It comes less than a week after the U.S. Senate passed a bill to create a regulatory framework for U.S.-dollar-pegged stablecoins, a move which, if rubberstamped by the House, is expected to fuel a further explosion in their popularity. Stablecoins are a type of cryptocurrency designed to maintain a constant value, usually a 1:1 dollar peg, backed by real-world assets such as U.S. Treasuries or gold. Dollar-pegged coins currently account for 99% of the market, which is estimated to have over $260 billion worth of coins in circulation. "Stablecoins as a form of sound money fall short, and without regulation pose a risk to financial stability and monetary sovereignty," BIS said in a early-released chapter of its annual report due to be published on Sunday. Hyun Song Shin, the BIS' Economic Adviser, explained that stablecoins lack the traditional settlement function provided by a central bank with fiat money. He likened them to private banknotes circulating in the 19th-century Free Banking era in the United States. It means they can often trade at varying exchange rates depending on the issuer, undermining the no-questions-asked principle of central bank-issued money. "Singleness is either you have it or you don't," Shin said, also warning of the risk of "fire sales" of the assets backing stablecoins if they collapse, as TerraUSD (UST) and the cryptocurrency LUNA did in 2022. There is also the concern around who controls stablecoins. Tether currently has more than half of the overall stablecoin market, but quit the EU following the introduction of new rules which require stablecoin operators to be licensed by the bloc. "The whole question of disclosure, this is where some of the stablecoins differ," BIS Deputy General Manager Andrea Maechler said. "You will always have the question about the quality of the asset backing. Is the money really there? Where is it?" BOLD ACTIONS The BIS wants central banks to go down the route of tokenised "unified ledger" incorporating central bank reserves, commercial bank deposits and government bonds. It would mean central bank money remains both the primary means of global payment and that currencies and bonds from around the world could effectively be integrated into the same "programmable platform". Tokenisation is aimed at creating a digitalised central bank system that settles payments and securities trades almost instantaneously and more cheaply by cutting the need for certain time consuming checks, as well opening up new functionality. It can also make the system more transparent, resilient and interoperable and may protect the system from some of the more unpredictable elements of cryptocurrencies. There would be a number of key issues to overcome, including who gets to set the rules governing the platform and that individual countries are likely to want to retain significant control of how and who uses their currencies. "Realising the full potential of the system requires bold action," the outgoing head of the BIS, Agustin Carstens, said. (Reporting by Marc Jones, Additional reporting by Elizabeth Howcroft, Editing by Louise Heavens)
