Headlines

The European Central Bank said it will start purchasing private sector assets as soon as this month, in an attempt to revive lending in the eurozone and stave off the risk of deflation, the Financial Times reported. The ECB governing council opted to leave its benchmark interest rate at 0.05 per cent. The deposit rate charged on a portion of banks’ reserves parked at the ECB stayed at 0.2 per cent.

Australian central bank officials said possible steps to cool the nation’s housing market wouldn’t necessarily be limited to investor lending curbs.

Argentina's central bank chief resigned on Wednesday after a long tussle with the Economy Ministry and was replaced with a regulator considered sympathetic to the interventionist stance of a government battling one of the world's highest inflation rates, Reuters reported. The move drew a sharp negative reaction in financial markets, with the price of Argentina's local U.S. dollar-denominated bonds skidding.

Property developer Seán Dunne would be allowed to “further manipulate assets” and frustrate the efforts of his creditors if he is allowed to withdraw his US bankruptcy case, Ulster Bank has told a US court, the Irish Times reported. Objecting to Mr Dunne’s application to dismiss his case before Connecticut’s bankruptcy court, Ulster Bank, one of the US-based developer’s biggest creditors, said in a new legal filing that the investigation into his finances would be “substantially hampered” if the court granted his motion to dismiss.

Factories in Britain and Germany suffered a sharp slowdown in September, raising fears that economic recovery is losing momentum against a backdrop of global political turmoil and the flagging eurozone economy, The Guardian reported. In the UK growth in manufacturing activity was the slowest in 17 months as demand for British goods waned at home and abroad. In Germany, long the powerhouse of the eurozone, the sector shrank for the first time in 15 months, hit by Russian sanctions over the Ukraine crisis and general malaise across the economies of the currency bloc.

The Central Bank of Ireland is considering imposing limits on the income multiples financial institutions here use when giving residential mortgages, the Irish Times reported. It is understood that the regulator will issue a consultation paper this month on the imposition of limits as it seeks to gather views from the banking sector and other interested parties. This move comes as property prices begin to soar again, with Dublin prices up 25 per cent in the year to August.

Banks should consider paying bonuses in the form of debt and giving their creditors a greater voice in boardrooms in an effort to keep risk-taking under control, the International Monetary Fund has said, the Financial Times reported. The findings, which are part of the IMF’s twice yearly Global Financial Stability Report, come after several countries, including the US, the EU and the UK, have passed reforms aimed at reducing the incentives for banks to gamble recklessly in the hope of driving up profits and payouts.

Singapore’s home prices declined for a fourth consecutive quarter, the longest losing streak in five years, as tighter mortgage measures cooled demand in Asia’s second-most expensive housing market, Bloomberg News reported. An index tracking private residential prices fell 0.6 percent to 208.1 points in the three months ended Sept. 30, following a 1 percent decline in the previous three-month period, according to preliminary data released by the Urban Redevelopment Authority today. The decline matched the losing streak ended June 2009, the data showed.

The focus of the coming European bank stress test shouldn't be on the number of banks that fail it, but rather the changes that banks have already undertaken to make themselves stronger, said the head of Europe's banking watchdog Tuesday, The Wall Street Journal reported.

China stepped up its efforts on Tuesday to transform doomsday scenarios for its domestic property market into merely another round of déjà vu. The central bank reinforced efforts to boost mortgage lending by banks, building on the small but significant turnaround that beyondbrics noted in mid-September. The new policies allow buyers who already own one home but have paid off their mortgage to be considered as first-time buyers, thus qualifying for a mortgage downpayment of 30 per cent of the cost of the loan.