March 27, 2024
United States:
Asset-Backed Securities Face New Risks From a US Court Decision
A federal court decision has raised new legal risks for a corner of Wall Street that bundles consumer loans into asset-backed securities.
A US appeals court last week for the first time upheld the power of the Consumer Financial Protection Bureau to sue trusts that issue the securities if debt-collection companies or others they hire run afoul of the law. The trusts outsource the role of collecting on the loans that they package into bonds and sell off to investors.
Europe:
ECB’s Cipollone Sees Scope to Cut Swiftly Despite Wage Gains
The European Central Bank may be able to lower interest rates “swiftly” even as workers receive large wage increases to catch up with two years of elevated inflation, according to Executive Board member Piero Cipollone.
A recovery in salaries is needed for Europe’s struggling economy to regain some momentum, the Italian official said Wednesday, stressing that pay rises should moderate with time. Inflation, meanwhile, is retreating, meaning the point at which monetary settings can be loosened is nearing, he said.
Asia:
BOJ’s Hawkish Member Eyes Steady Rate Hikes for Normalization
Bank of Japan Board Member Naoki Tamura signaled his desire to gradually keep raising interest rates as the bank further pursues policy normalization after raising rates last week for the first time since 2007.
“The handling of monetary policy is extremely important from here on for slow but steady progress in normalization to fold back the extraordinarily large-scale monetary easing,” Tamura said Wednesday in a speech to local business leaders in Aomori, northeastern Japan.
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