The latest economic statement by Eric Van Nostrand, performing duties of Assistant Secretary for Economic Policy for the Treasury Borrowing Advisory Committee, highlights the current state of the U.S. economy as of April 29, 2024.Van Nostrand noted that despite a slowdown in real GDP growth to 1.6 percent in the first quarter of 2024, the underlying demand from households and businesses remained strong. He emphasized that personal consumption and business fixed investment played crucial roles in supporting GDP growth, with residential investment showing significant...
The Basel Committee on Banking Supervision (BCBS) has issued a discussion paper outlining the objectives of climate scenario analysis within the Basel framework. According to the paper, climate scenario analysis is described as a forward-looking tool to assess the resilience of business models and strategies of banks.In the discussion paper, the BCBS has identified key features that are crucial for the effectiveness of climate scenario analysis exercises conducted by banks or supervisors. These features include clear objectives, comprehensiveness, plausibility, coherence,...
A vision for the future financial system, outlined in a recent BIS paper, envisions a transformative shift towards a user-centric and unified financial ecosystem. The paper describes the concept of "Finternet" as a digital-era financial system that is inclusive, innovative, participatory, accessible, and affordable for all. It emphasizes leveraging innovative technologies like tokenization and unified ledgers to enhance financial services for users.The authors of the paper highlight three essential components for Finternet: an efficient economic and financial...
Assistant Secretary for Financial Markets Josh Frost presented the Quarterly Refunding Statement on April 29, 2024, outlining the U.S. Department of the Treasury's plans for upcoming Treasury securities offerings. Frost announced, "The U.S. Department of the Treasury is offering $125 billion of Treasury securities to refund approximately $107.8 billion of privately-held Treasury notes maturing on May 15, 2024." The issuance aims to raise new cash from private investors amounting to approximately $17.2 billion.The upcoming securities offerings include a 3-year note of $58...
Secretary of the Treasury Janet L. Yellen addressed the Committee on Ways & Means of the U.S. House of Representatives, highlighting the significant strides made in the economic landscape under the Biden Administration. Yellen expressed gratitude for the opportunity to testify and stated, "The Biden Administration has driven a historic economic recovery over the past three years."Yellen emphasized the administration's focus on reducing household expenses and enhancing economic opportunities, stating, "President Biden and I are taking additional actions to bring down the...
In a recent report released by the NGFS, options for the supervisory review of transition plans were outlined, focusing on micro-prudential perspectives. The report builds on previous work and emphasizes the importance of credible transition planning and plans, as well as the role of supervisory authorities in assessing their credibility.The report suggests three potential ways to operationalize the transition plan review process by supervisory authorities. This includes direct monitoring by Micro-Prudential Authorities, reliance on Third-Party Evaluations, and a...
The Federal Reserve Bank of Richmond recently hosted a Community Bank Credit Forum, bringing together representatives from various banks to discuss crucial topics related to credit and risk management."We’re one of 12 regional Federal Reserve Banks working together with the Board of Governors to support a healthy economy. Our job is to serve the American public — to serve you," stated a representative from the Federal Reserve Bank.The event saw over 40 attendees from banks across the Fifth Federal Reserve District convene to engage in discussions on credit risk...
The U.S. Department of the Treasury and the Internal Revenue Service (IRS) have issued guidance on the Sustainable Aviation Fuel (SAF) Credit established by the Inflation Reduction Act (IRA) to promote innovation in the aviation industry and reduce emissions. This initiative is part of President Biden's agenda to create jobs and combat climate change.U.S. Treasury Secretary Janet L. Yellen emphasized the importance of the Inflation Reduction Act in driving American innovation and job creation, stating, "Incentives in the law are helping to scale production of low-carbon...
WASHINGTON – The U.S. Department of the Treasury has disclosed its borrowing estimates for the upcoming quarters of 2024. According to the announcement, for the April – June 2024 quarter, the Treasury plans to borrow $243 billion in privately-held net marketable debt, with an end-of-June cash balance of $750 billion. The borrowing estimate is $41 billion higher than previously anticipated, primarily due to decreased cash receipts, partially offset by a higher beginning of the quarter cash balance.Looking ahead to the July – September 2024 quarter, the Treasury projects a...
The U.S. Department of the Treasury and the Department of Energy have announced new guidance on the Inflation Reduction Act programs aimed at boosting manufacturing and clean energy investments in coal communities. The Biden-Harris Administration revealed plans for a $6 billion tax credit allocation round to support clean energy supply chains and advanced energy projects, with a significant portion earmarked for historic energy communities impacted by coal-related closures.Deputy Secretary of the Treasury Wally Adeyemo emphasized the importance of driving investments in...
The final results from the annual survey of foreign portfolio holdings of U.S. securities at the end of June 2023 were released today, as reported by the Treasury website. The survey, conducted jointly by Treasury, the Federal Reserve Bank of New York, and the Board of Governors of the Federal Reserve System, revealed some insightful data.According to the survey, the value of foreign portfolio holdings of U.S. securities as of June 30, 2023, was $26,872 billion. This amount was broken down into $13,719 billion held in U.S. equities, $11,967 billion in U.S. long-term debt...
The recent meeting of the Treasury Borrowing Advisory Committee held on April 30, 2024, saw various discussions and recommendations put forth by key stakeholders in the financial sector.Under Secretary Liang expressed gratitude to outgoing Vice Chair Colin Teichholtz for his service to the committee at the beginning of the meeting. This set the tone for a series of discussions on debt management and Treasury priorities.During the meeting, it was noted that primary dealer estimates for the next three fiscal years were slightly lower than previous estimates, with a...
WASHINGTON – In a recent development, the U.S. Department of the Treasury and the White House came together to facilitate a discussion aimed at enhancing access to affordable, high-quality child care. The focus of the convening was on fostering collaboration between small childcare businesses, Community Development Financial Institutions (CDFIs), and key stakeholders.The event witnessed the participation of various notable figures, including Director of the Gender Policy Council Jennifer Klein and Domestic Policy Advisor Neera Tanden. Deputy Assistant Secretary for...
The Treasury Borrowing Advisory Committee recently submitted a detailed report to the Secretary of the Treasury, outlining various economic factors and developments that have influenced Treasury yields and market dynamics. In the letter addressed to the Secretary, the Committee highlighted key points regarding inflation, economic growth, job growth, and geopolitical tensions that have impacted the financial landscape.Regarding inflation, the Committee noted that core PCE inflation in Q1 was stronger than expected at 3.7% annualized, with slower goods price inflation...
Under Secretary Brian Nelson addressed attendees at ACI’s Annual Flagship Conference on Economic Sanctions Enforcement and Compliance, expressing gratitude for the invitation and highlighting the importance of the practitioners' work in advising on sensitive sanctions matters. Nelson acknowledged the Treasury's efforts to enhance the rigor and effectiveness of sanctions enforcement and compliance. He emphasized the need for a modernized approach to sanctions in response to evolving global challenges.Nelson praised the successful multilateral partnerships in response to...
The U.S. Department of the Treasury and Internal Revenue Service (IRS) have reported that the Direct File pilot program surpassed expectations, with 140,803 taxpayers filing their taxes directly with the IRS for free, resulting in substantial savings for taxpayers. Users of the program claimed over $90 million in refunds and saved an estimated $5.6 million in tax preparation fees on federal returns alone.Deputy Secretary of the Treasury Wally Adeyemo praised the success of the program, stating, “The IRS’s Direct File pilot enabled more than 140,000 taxpayers to file their...
WASHINGTON – The U.S. Department of the Treasury’s Federal Insurance Office (FIO) has announced a new partnership with the National Science Foundation (NSF) aimed at enhancing the insurance sector's capabilities in handling terrorism and catastrophic cyber risks. This collaboration was unveiled during the 2024 International Forum of Terrorism Risk (Re)Insurance Pools Annual Conference, where FIO also assumed the role of the chair of IFTRIP.The establishment of a new Industry-University Cooperative Research Center (IUCRC) is at the core of this partnership. Through the...
CFIT, the chair of the Open Finance Taskforce, has announced two trial initiatives aimed at providing recommendations to the UK government on unlocking financial data safely. According to a CFIT press release, SME lenders, including Barclays, will collaborate to design and implement open finance solutions to accelerate SME credit assessment and loan decision-making. This initiative is expected to address the GBP 22 billion funding gap that hinders SMEs from investing and innovating.In addition, Citizens Advice (CA) and CFIT will conduct industry-driven pilots in...
The Office of the Superintendent of Financial Institutions (OSFI) has announced the issuance of a Phase 2 consultation on a Climate Scenario Exercise for banks. According to the announcement, the exercise will involve various components including impact assessments on credit and market risks for commercial exposures, as well as evaluations of real estate and physical risk exposures.OSFI stated, "The final versions of these documents as well as a questionnaire (SCSE Questionnaire) will be released in late 2024." The regulator highlighted the importance of completing...
Federal Reserve Bank of Boston President Susan M. Collins emphasized the importance of collaboration in addressing wealth disparities, stating, “There’s a lot to be done, and we each bring different ideas, thoughts, and understandings to the table. Unless we work together, we’re not going to be successful in terms of moving things forward.”During a roundtable discussion in Hamden at the Connecticut Community Outreach Revitalization Program, OrLando Yarborough III, director of ConnCAT’s bioscience training programs, highlighted the need for creating career pipelines and...
