Stefan Avdjiev, Leonardo Gambacorta, Linda Goldberg, Stefano Schiaffi, 20 March 2018

The post-crisis period has seen a considerable shift in drivers of international bank lending and international bond issuance, the two main components of global liquidity. This column describes how the sensitivity of cross-border lending to global risk conditions declined substantially post-crisis, becoming similar to that of international bond issuance. This fall largely reflects a change in the composition of international lenders.

Eugenio Cerutti, Stijn Claessens, Lev Ratnovski, 08 June 2014

‘Global liquidity’ is often used to describe the impact of low US and EZ interest rates on the rest of the world. The concept is critical for understanding the global financial cycle and international spillovers. This column defines global liquidity as the ease of financing in cross-border markets and points to its potential drivers. To limit their exposures to global liquidity fluctuations nations can embrace better macro policy frameworks, consider capital flow management tools, and more stringently regulate and supervise banks.

Hyun Song Shin, 25 March 2011

Hyun Song Shin of Princeton University talks to Viv Davies about his current work on global liquidity and highlights the paradox of how the US, while being the largest net debtor in the world, is also a substantial net creditor in the global banking system. They also discuss the Basel III requirements, bank capital ratios and the lending capacity of bank equity. Shin stresses the importance of international coordination to the success of financial and regulatory reform. The interview was recorded in Washington DC in March 2011 at the IMF conference, ‘Macro and Growth Policies in the Wake of the Crisis’. [Also read the transcript]

Vox eBooks


CEPR Policy Research