China and the United States, as the two largest economies, are engaged in an intense economic competition. While the U.S. maintains global economic dominance, several factors suggest China could outpace or even win an economic war against its rival.
Sponsor
Showing posts with label Economy. Show all posts
Showing posts with label Economy. Show all posts
Friday, November 29, 2024
Saturday, January 2, 2021
Malaysia Digital Bank License
With Hong Kong and Singapore having accelerated the issuance of their digital banks licenses, is Malaysia’s foray into the space a bit slow?
Based on this week’s announcement by Bank Negara, digital bank licenses will be issued only by the first quarter of 2022. The concern is would the Malaysian digital bank landscape have lost ground by then? Globally, digital banks are already in advance stages of operations.
To be sure, setting the rules right on the onset for digital banking is of utmost importance. It involves the main artery of the economy, namely the banking system. Perhaps this is why Malaysia’s central bank is not rushing the matter.
On Thursday, Bank Negara issued a policy document on licensing framework for digital banks following a six-month public consultation.
Bank Negara said the licensing framework for digital banks aims to enable the innovative application of technology to uplift the financial well-being of individuals and businesses and foster sustainable growth.
This includes expanding meaningful access to and promoting responsible usage of suitable financial solutions to the unserved and underserved segments.
The framework adopts a balanced approach to enable admission of digital banks with strong value propositions while safeguarding the integrity and stability of the financial system, as well as depositors’ interests.
To achieve these outcomes, a simplified regulatory framework will be applied to digital banks during the initial stage of operations, commensurate with an asset threshold of not more than RM3bil for three to five years.
Submission of applications to conduct digital banking business or Islamic digital banking business shall be made to the Bank no later than June 30,2021.
Up to five licenses may be issued to qualified applicants. Notification on the grant of license will be made by the first quarter of 2022, Bank Negara said.
It does seem that the central bank is on the right track with ensuring only the most qualified applicants get to run digital banks.
That said, one wonders how the digital banking space will grow globally and whether Malaysian licenses could have lost any ground by 2022.
Based on this week’s announcement by Bank Negara, digital bank licenses will be issued only by the first quarter of 2022. The concern is would the Malaysian digital bank landscape have lost ground by then? Globally, digital banks are already in advance stages of operations.
To be sure, setting the rules right on the onset for digital banking is of utmost importance. It involves the main artery of the economy, namely the banking system. Perhaps this is why Malaysia’s central bank is not rushing the matter.
On Thursday, Bank Negara issued a policy document on licensing framework for digital banks following a six-month public consultation.
Bank Negara said the licensing framework for digital banks aims to enable the innovative application of technology to uplift the financial well-being of individuals and businesses and foster sustainable growth.
This includes expanding meaningful access to and promoting responsible usage of suitable financial solutions to the unserved and underserved segments.
The framework adopts a balanced approach to enable admission of digital banks with strong value propositions while safeguarding the integrity and stability of the financial system, as well as depositors’ interests.
To achieve these outcomes, a simplified regulatory framework will be applied to digital banks during the initial stage of operations, commensurate with an asset threshold of not more than RM3bil for three to five years.
Submission of applications to conduct digital banking business or Islamic digital banking business shall be made to the Bank no later than June 30,2021.
Up to five licenses may be issued to qualified applicants. Notification on the grant of license will be made by the first quarter of 2022, Bank Negara said.
It does seem that the central bank is on the right track with ensuring only the most qualified applicants get to run digital banks.
That said, one wonders how the digital banking space will grow globally and whether Malaysian licenses could have lost any ground by 2022.
Tuesday, February 19, 2013
Global Economy Worsening
Industrial metals also dipped and European shares were soft on lingering worries about the economic outlook, especially for the euro zone. While the risk of an inconclusive outcome in Italy’s forthcoming election added to investor concerns.
However, activity was curtailed by the closure of markets in the United States for the Presidents’ Day holiday.
The yen, which has dropped 20 per cent against the dollar since mid-November, fell further after financial leaders from the G20 promised not to devalue their currencies to boost exports and avoided singling out Japan for any direct criticism.
The dollar rose 0.5 per cent to 93.95 yen, near a 33-month peak of 94.47 yen set a week ago. The euro added 0.3 per cent to 125.40 yen, to be midway between Friday’s two-week low of 122.90 and a 34-month high of 127.71 yen hit earlier this month.
Strategists said the yen was likely to stay weak, though its decline could lose momentum until it becomes clear who will be taking the helm at the Bank of Japan when the current governor steps down on March 19.
“The yen probably will weaken a little further in anticipation of more aggressive easing under a new leadership team at the Bank of Japan,” said Julian Jessop, chief global economist at Capital Economics.
Japan’s Prime Minister Shinzo Abe is poised to nominate the new governor in the next few days. Sources have told Reuters that former financial bureaucrat Toshiro Muto, considered likely to be less radical than other candidates, was leading the field.
Meanwhile the euro dipped slightly against the dollar when European Central Bank president Mario Draghi said the currency’s recent gains made any rise in inflation less likely and added that he had yet to see any improvement in the euro zone economy.
Speaking before the European Parliament, Draghi said the euro’s exchange rate was not a policy target but was important for growth and stability, adding that appreciation of the euro “is a risk”.
The comments left the euro down 0.2 per cent at US$1.3334 (RM4.132).
Elsewhere in the currency market, sterling hit a seven-month low against the dollar, after a key policymaker made comments about the need for further weakness and recent poor data which has kept alive worries of another British recession.
Sterling fell 0.25 per cent to US$1.5476 having earlier touched US$1.5438, its lowest since July 13.
DATA LOOMS
A big week for data on the outlook for the world’s economy weighed on other riskier asset markets following the recent dire fourth-quarter growth numbers for the euro zone and Japan, along with Friday’s soft US manufacturing figures.
In European markets, attention is focused on the euro area Purchasing Managers’ Indexes for February and German sentiment indices due later in the week which could affect hopes for a recovery this year.
Analysts expect Thursday’s euro area flash PMI indices, which offer pointers to economic activity around six months out, to show growth stabilizing across the recession-hit region, leaving intact hopes for a recovery in the second half of 2013.
Concerns over an inconclusive outcome in the Italian election on Sunday and yesterday have added to the weaker sentiment as a fragmented parliament could hamper a future government’s efforts to reform the struggling economy.
The worries about the outlook for Italy were encouraging investors back into safe-haven German government bonds yesterday, with 10-year Bund yields easing 3.5 basis points to be around 1.63 per cent.
“Political uncertainty will keep Bunds well bid this week,” ING rate strategist Alessandro Giansanti said, adding that only better than expected economic data could create selling pressure on German debt in the near term.
Italian 10-year yields were 4 basis points higher on the day at 4.41 per cent.
Saturday, February 16, 2013
G20 defuses talk of ‘"currency war"
MOSCOW, Feb 16 — The Group of 20 nations declared on Saturday there would be no 'currency war' and deferred plans to set new debt-cutting targets in an indication of concern about the fragile state of the world economy.
Japan's expansive policies, which have driven down the yen, escaped criticism in a statement agreed in Moscow by financial policymakers from the G20, which groups developed and emerging markets and accounts for 90 percent of the world economy.
After late-night talks, finance ministers and central bankers agreed on wording closer than expected to a joint statement issued last Tuesday by the Group of Seven rich nations backing market-determined exchange rates.
A draft communique seen by delegates on Friday had steered clear of the G7's call for fiscal and monetary policy not to be targeted at exchange rates but the final version included a G20 commitment to refrain from competitive devaluations and stated monetary policy would be directed at price stability and growth.
"The language has been strengthened since our discussions last night," Canadian Finance Minister Jim Flaherty told reporters. "It's stronger than it was, but it was quite clear last night that everyone around the table wants to avoid any sort of currency disputes."
The communique, seen by Reuters ahead of publication, did not single out Japan for aggressive monetary and fiscal policies that have seen the yen drop 20 percent.
The statement reflected a substantial, but not complete, endorsement of Tuesday's statement by the G7 nations - the United States, Japan, Britain, Canada, France, Germany and Italy.
"We all agreed on the fact that we refuse to enter any currency war," French Finance Minister Pierre Moscovici told reporters.
No fiscal targets
The text also contained a commitment to credible medium-term fiscal strategy, but stopped short of setting specific goals. A debt-cutting pact struck in Toronto in 2010 will expire this year if leaders fail to agree to extend it at a G20 summit of leaders in St Petersburg in September.
"Advanced economies will develop credible medium-term fiscal strategies ... by the St. Petersburg summit," the communique said.
The United States, which has resorted to massive monetary stimulus and higher government borrowing to drive growth and cut jobless queues, blocked a push from Europe to commit to reducing budget deficits.
Russian Finance Minister Anton Siluanov said the G20 had failed to reach agreement on medium-term budget deficit levels.
"We expect by April countries will have made progress on reaching a balanced approach to establishing new budget indicators on both, deficit and the level of government debt," Siluanov said.
Russia, this year's chair of the G20, also expressed concern about ultra-loose policies that it and other big emerging economies say could store up trouble for later.
Siluanov said a rebalancing of global growth required more than an adjustment of exchange rates.
"Structural reforms in all countries, either with a positive or negative balance of payments, should play a bigger role," he said, adding that spillover effects of unconventional monetary policy, conducted by central banks in some countries, should be closely monitored.
The G20 put together a huge financial backstop to halt a market meltdown in 2009 but has failed to reach those heights since. At successive meetings, Germany has pressed the United States and others to do more to tackle their debts. Washington in turn has urged Berlin to do more to increase demand.
On currencies, the G20 text reiterated its commitment last November, to move towards "exchange rate flexibility to reflect underlying fundamentals and avoid persistent exchange rate misalignments".
"The G7 made a very clear statement this week. I think you'll see the G20 echo what was said, and say that currencies should not be used as a tool of competitive devaluation," Britain's finance minister, George Osborne, said in Moscow.
"Countries shouldn't make the mistake of the past of using currencies as a tool of economic warfare." — AFP-Relaxnews
Japan's expansive policies, which have driven down the yen, escaped criticism in a statement agreed in Moscow by financial policymakers from the G20, which groups developed and emerging markets and accounts for 90 percent of the world economy.
After late-night talks, finance ministers and central bankers agreed on wording closer than expected to a joint statement issued last Tuesday by the Group of Seven rich nations backing market-determined exchange rates.
A draft communique seen by delegates on Friday had steered clear of the G7's call for fiscal and monetary policy not to be targeted at exchange rates but the final version included a G20 commitment to refrain from competitive devaluations and stated monetary policy would be directed at price stability and growth.
"The language has been strengthened since our discussions last night," Canadian Finance Minister Jim Flaherty told reporters. "It's stronger than it was, but it was quite clear last night that everyone around the table wants to avoid any sort of currency disputes."
The communique, seen by Reuters ahead of publication, did not single out Japan for aggressive monetary and fiscal policies that have seen the yen drop 20 percent.
The statement reflected a substantial, but not complete, endorsement of Tuesday's statement by the G7 nations - the United States, Japan, Britain, Canada, France, Germany and Italy.
"We all agreed on the fact that we refuse to enter any currency war," French Finance Minister Pierre Moscovici told reporters.
No fiscal targets
The text also contained a commitment to credible medium-term fiscal strategy, but stopped short of setting specific goals. A debt-cutting pact struck in Toronto in 2010 will expire this year if leaders fail to agree to extend it at a G20 summit of leaders in St Petersburg in September.
"Advanced economies will develop credible medium-term fiscal strategies ... by the St. Petersburg summit," the communique said.
The United States, which has resorted to massive monetary stimulus and higher government borrowing to drive growth and cut jobless queues, blocked a push from Europe to commit to reducing budget deficits.
Russian Finance Minister Anton Siluanov said the G20 had failed to reach agreement on medium-term budget deficit levels.
"We expect by April countries will have made progress on reaching a balanced approach to establishing new budget indicators on both, deficit and the level of government debt," Siluanov said.
Russia, this year's chair of the G20, also expressed concern about ultra-loose policies that it and other big emerging economies say could store up trouble for later.
Siluanov said a rebalancing of global growth required more than an adjustment of exchange rates.
"Structural reforms in all countries, either with a positive or negative balance of payments, should play a bigger role," he said, adding that spillover effects of unconventional monetary policy, conducted by central banks in some countries, should be closely monitored.
The G20 put together a huge financial backstop to halt a market meltdown in 2009 but has failed to reach those heights since. At successive meetings, Germany has pressed the United States and others to do more to tackle their debts. Washington in turn has urged Berlin to do more to increase demand.
On currencies, the G20 text reiterated its commitment last November, to move towards "exchange rate flexibility to reflect underlying fundamentals and avoid persistent exchange rate misalignments".
"The G7 made a very clear statement this week. I think you'll see the G20 echo what was said, and say that currencies should not be used as a tool of competitive devaluation," Britain's finance minister, George Osborne, said in Moscow.
"Countries shouldn't make the mistake of the past of using currencies as a tool of economic warfare." — AFP-Relaxnews
Subscribe to:
Posts (Atom)
