European Central Bank Research

Insights, analysis and other news from @ecb researchers. Authors' views are their own, and not necessarily those of the European Central Bank.

[European Central Bank Research @ECB_Research]

Authors estimate the model structurally at the firm level and find that financial uncertainty driven by liquidity shocks is much more important than real uncertainty driven by cash flow shocks for explaining the low utilization of credit. 4/4

[European Central Bank Research @ECB_Research]

🧵New @ecb Working Paper by A. Rogantini Picco, N. Amberg, T. Jacobson & V. Quadrini: “Dynamic credit constraints: theory and evidence from credit lines” https://t.co/LU7EhnwSXj 1/4

[European Central Bank Research @ECB_Research]

The low utilization of credit is consistent with a theoretical model in which utilization rates decrease with both real and financial uncertainty. 3/4

[European Central Bank Research @ECB_Research]

Do crypto adopters reject cash? No, correlations show portfolio complementarity in normal times. However, an IV strategy reveals a causal sign reversal under stress: building cash buffers crowds out crypto, consistent with a flight-to-safety dynamic. 4/4

[European Central Bank Research @ECB_Research]

🧵New @ecb Working Paper by A. Zamora-Pérez: “Who owns crypto in the euro area? Drivers of crypto adoption, payment use, and its interaction with fiat cash” https://t.co/sDGAl6SPSb 1/4

[European Central Bank Research @ECB_Research]

Using ECB SPACE survey data (~40k euro area adults), the paper shows a clear segmentation.
Owners: Savvy crypto investors who value card speed but prioritize cash-like privacy.
Payers: A niche cash-centric group seeking to replicate physical cash's attributes in digital form. 3/4

[European Central Bank Research @ECB_Research]

Central clearing does more than mitigate counterparty risk. By pooling borrowers, CCPs change how borrower risk and collateral scarcity are reflected in repo rates. Market structure therefore shapes price formation in repo markets and matters for financial regulation. 5/5

[European Central Bank Research @ECB_Research]

🧵New @ecb Working Paper by J. Metzler, P. Danisewicz, T. Dieler, L. Mancini, F. Mazzari “Central clearing and the pricing of specialness in repo markets” https://t.co/oruX50Bf6c 1/5

[European Central Bank Research @ECB_Research]

Using ECB's MMSR transaction-level data we find strong support for the model's cross-sectional predictions: The compression of the CCP–OTC differential after the uncertainty shock is stronger for safer borrowers and for safer collateral. 4/5

[European Central Bank Research @ECB_Research]

New @ecb Working Paper by E. Batbayar, C. Breunig, P. Haan & B. Ilieva “Quantile selection in the gender pay gap” https://t.co/HEP4b3xtL8

[European Central Bank Research @ECB_Research]

New @ecb Working Paper by Y. Timmer, A. Van der Ghote & A. Perez-Orive “Monetary policy under multiple financing constraints” https://t.co/rc7IW1vJEe

[European Central Bank Research @ECB_Research]

New @ecb Working Paper by M. Darracq Pariès, V. Jouvanceau & A. Eyquem “The third-country effects of trade wars” https://t.co/0NgyQKA3rL

[European Central Bank Research @ECB_Research]

The tentative findings indicate that conditional, reform-linked financing tools like the RRF can enhance institutional quality and long-term growth prospects – provided that the reforms are well designed and effectively implemented. 5/5

[European Central Bank Research @ECB_Research]

New @ecb Working Paper by N. Zorell & Christoph Zwick “Assessing the impact of the EU’s Recovery and Resilience Facility on institutional quality: a Bayesian synthetic control approach” https://t.co/Um0CAdBttQ 1/5

[European Central Bank Research @ECB_Research]

The cross-country variation is broadly consistent with the implementation of the national Recovery and Resilience Plans in terms of implementation speed and reform mix. 4/5