Brussels, 24/06/2014 (Agence Europe) - On 23 June, the European Central Bank (ECB) published a final report summarising the work of the Macro-prudential Research Network (MaRs) from 2010 to 2014.
Overall, MaRs produced more than 160 individual research papers and completed several large joint cross-country projects involving multiple central banks. The three key conclusions are 1) macroeconomic models need to be improved to let policy-makers see how financial imbalances can build up over time and then break down in a crisis and how systemic financial crises can lead to drastic macroeconomic adjustments and recessions that traditional economic models are unable to predict; 2) measuring systemic risk by developing tools to provide early warnings about the build-up of financial imbalances; 3) assessing the risk of bank contagion using a new data infrastructure - derived from payment system information - for analysing and monitoring the stability of the euro interbank market. (MB)