Macroprudential policy assessments - report released by the Committee on the Global Financial System

Central banks should take a holistic approach to assessing the value of policies aimed at safeguarding financial stability, the CGFS says in a report published today.

Entitled Experiences with the ex ante appraisal of macroprudential instruments, the report finds that gauging the net benefits of such instruments, for example by using stress tests or models, requires expertise in a range of areas from financial markets to monetary policy. Further, internal and external cooperation is key to building a full picture.

"There is a definite trend towards greater use of quantitative analysis in assessing the benefits and possible adverse implications of macroprudential instruments," said CGFS Chairman William Dudley, President of the Federal Reserve Bank of New York. He added: "The report provides an overview of central banks' experiences in performing those appraisals and should serve a useful reference to applied policymaking."

Note to editors:

The report was approved by the central bank Governors of the Global Economy Meeting at their June meeting at the Bank for International Settlements in Basel.

The Committee on the Global Financial System (CGFS), comprising Deputy Governors and other senior central bank officials, monitors financial market developments and analyses the implications of these developments for financial stability and central bank policy. Today's report was prepared by a Study Group chaired by Anne Le Lorier, First Deputy Governor of the Bank of France, and follows CGFS reports on issues related to macroprudential policy that were published in May 2010 and December 2012.