Thus, the information requirements for conducting truly comprehensive macroprudential surveillance could be daunting indeed.
At least informally, financial regulation and supervision in the United States already include some macroprudential elements.
But in Brazil, macroprudential measures aside, monetary policy has real rates at 5.75%.
The Brazilian currency has been strengthening lately and will likely continue on that path as the government unwinds its macroprudential measures.
Investors were not convinced that monetary and fiscal policies were having a positive impact on price increases, and worried that macroprudential measures could hurt the economy.
Right now, trading ranges are an unknown as the market digests a recent bout of macroprudential measures, further monetary easing and continued problems with the European Union.
It was breached around three weeks ago, just prior to the Carnaval party celebrations, causing government officials to warn of new macroprudential measures to keep the currency from appreciating.
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An alternative approach, which has been called system-wide or macroprudential oversight, would broaden the mandate of regulators and supervisors to encompass consideration of potential systemic risks and weaknesses as well.
In contrast, the macroprudential supervisor would recognize that, for the system as a whole, excessively conservative lending policies could prove counterproductive if they contribute to a weaker economic and credit environment.
This stems from a recognition that traditional oversight needs to go hand in hand with the macroprudential sort that takes account of the collective behaviour of financial firms, contagion effects and so on.
Key elements in this regard include countercyclical capital buffers, the implementation of more resilient financial market infrastructure, reductions in the variability of repo margins, and other macroprudential policies such as loan-to-value ratios in property markets.
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Macroprudential supervision also presents communication issues.
The adoption of a regulatory and supervisory approach with a heavier macroprudential focus has a strong rationale, but we should be careful about over-promising, as we are still rather far from having the capacity to implement such an approach in a thoroughgoing way.
As Mr Borio at the Bank for International Settlements points out, many of the ideas around countercyclicality (setting aside more capital in good times) and macroprudential regulation (safeguarding the stability of the whole banking system as well as of individual banks) were oven-ready, having been worked on by a coterie of central bankers, academics and regulators for a number of years.
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