2026-08-15 Saturday

The FAO Food Price Index rose 0.6% in July to 131.1 points, driven by a 3.4% jump in cereals, with wheat up 5.8% on Black Sea disruptions and heatwaves. This compounds the inflationary shock from El Niño and Middle East conflict, pressuring food import bills and central bank inflation targets, particularly in emerging markets.

Taiwan's Q2 GDP grew 12.93% year-on-year, with 2026 forecast at 11.05%, while July PPI surged 16.94%, signaling strong export demand but rising input costs. The income gap at 6.17 times highlights distributional pressures, potentially influencing fiscal policy and social spending.

Norway's Finanstilsynet kept the countercyclical capital buffer for banks unchanged at 2.5% on August 13, 2026, and on August 12 it announced adherence to EBA guidelines on diversification of the mass market portfolio. Its 2026 risk and vulnerability analysis highlights a high digital threat level amplified by geopolitical tensions and complex value chains as critical vulnerabilities. The unchanged buffer signals a stable macroprudential stance, but the digital threat assessment could influence future buffer decisions. The full risk analysis, published on Finanstilsynet's website, details the threat scenarios that would clarify the potential for a buffer increase.

Slovakia's GDP rose 0.2% quarter-on-quarter in Q2, according to flash estimates from the National Bank of Slovakia, with industry stagnating due to an uncertain external environment and weakening competitiveness, while the labour market supports household consumption despite consolidation measures. The economy has grown weakly for over two years. The weak growth, despite labour market support, suggests fiscal consolidation is weighing on demand, a channel that could affect Slovak bond yields. The flash estimate, released by the statistics office, will be revised in the coming months, and the revision would settle the exact growth figure.

Finland's FIN-FSA announced a macroprudential decision raising the mortgage cap to 95% for all borrowers, and imposed fines on Oma Säästöpankki (€400,000) and Pareto Securities (€115,000) for compliance failures. It also announced the EBA's draft technical reporting framework 4.4 (phase 1) for IFRS 18 Finrep tables and the ECB's 2026 reverse stress test on geopolitical risks. The higher mortgage cap could fuel housing credit growth, a risk to financial stability that the stress test will assess. The ECB's reverse stress test results, due later in 2026, would reveal vulnerabilities to geopolitical shocks.

Government subsidies have nearly doubled since the global financial crisis, reaching USD 108 billion in 2024, but an ECB blog post finds they are unlikely to drive aggregate global imbalances, which primarily reflect saving-investment gaps. Global imbalances rose to 3.7% of world GDP in 2025, with China's surplus at a record 0.6% of world GDP and the US deficit at 0.9%. In China, subsidies account for about 2% of domestic firms' costs, versus 1.4% in the US and 0.6% in the euro area. Subsidy intensity is highest in semiconductors (3.9%) and solar panels (3.6%), and in strategic sectors subsidies contributed four to fourteen times more to export growth than in others. The finding challenges the narrative that subsidies are the main driver of external imbalances, suggesting instead that fiscal policy and saving-investment gaps matter more for exchange rates and capital flows.

A magnitude 7.7 earthquake struck Indonesia on August 14, 2026, at 21:58:21 UTC, located 68 kilometers northwest-northwest of Ende, according to the USGS, with a depth of 10 kilometers, triggering a tsunami alert and evacuation orders for coastal residents on Flores Island. The quake's shallow depth and location near populated areas raise the risk of significant damage, which could impact Indonesia's fiscal position through disaster relief spending. The GDACS alert, updated as assessments come in, would provide the casualty and damage figures that determine the fiscal impact.

The Reserve Bank of India's special USD-INR Forex Swap facility for FCNR(B) deposits, ECBs, and OFCB inflows attracted total inflows of $56,846 million as of August 13, 2026, with FCNR(B) deposits contributing $52,300 million, OFCBs $2,805 million, and ECBs $1,741 million. Due to the encouraging response, the swap facility for FCNR(B) deposits will only be available for deposits mobilized until August 31, 2026, with swaps availed until September 11, 2026. The facility's success has boosted India's forex reserves, and its closure could reduce future inflows, affecting the rupee's stability. The RBI's next weekly forex reserve release would show the impact on reserves.

A Bank of England Staff Working Paper No. 1,199 by Alvaro Contreras, Peter Eccles, and Paolo Siciliani finds that UK banks' spending on Cloud Service Providers is associated with lower operating costs and higher deposits, concentrated among large institutions, and that higher capital requirements drive CSP spending. Counterfactual analyses suggest restricting cloud outsourcing could significantly impact competition and efficiency. The paper uses proprietary bank-provider contract data, a source not widely covered, and its findings could inform future regulatory stances on cloud concentration risk. The full working paper, released on the BoE's website, contains the detailed counterfactual scenarios that would settle the magnitude of these effects.

FinCEN issued a final rule on 2026-08-13 (91 FR 52508) permanently narrowing Corporate Transparency Act beneficial ownership reporting to foreign reporting companies only, exempting all U.S. persons and domestic entities from BOI reporting and FinCEN ID update obligations. The rule adopts the March 26, 2025 interim final rule with limited changes, citing burden minimization and the Secretary's exemptive authority. It eliminates the requirement for any U.S. person to update or correct information for a FinCEN ID under 31 U.S.C. 5336(b)(4)(A). This reduces compliance costs for domestic entities, potentially lowering the cost of capital for small businesses, but narrows the transparency that law enforcement relied on. The final rule was buried in the Federal Register on August 13, 2026; a challenge from commenters arguing separation of powers violations could settle the scope, but no court date is set.

The IRS and Treasury proposed regulations (REG-103844-26) on 2026-08-13 (91 FR 52553) allowing controlled foreign corporations (CFCs) to elect out of computing and recognizing foreign currency gain or loss under section 987 for their qualified business units (QBUs), except for certain inbound nonrecognition transactions. Pre-election gain or loss would be amortized over 120 months, with a de minimis exception for QBUs with average assets under $50 million. The election must be made consistently for all members of a section 987 electing group. This reduces compliance burdens for CFCs, potentially lowering the effective tax rate on foreign earnings and affecting the repatriation calculus for U.S. multinationals. The proposal was hidden in the Federal Register alongside the FinCEN rule; comments are due by 2026-11-12, and the final rule's treatment of the de minimis threshold will determine its reach.

The International Financial Services Centres Authority (IFSCA) published a consultation paper on August 13, 2026, proposing a framework for leasing activities in IFSCs, and on August 12 released a consultation paper on amendments to the IFSCA Banking Handbook on General Directions, along with public comments on proposed amendments to the IFSCA (Fund Management) Regulations and Prohibition of Market Abuse Regulations. These consultations could reshape the regulatory landscape for IFSCs, affecting their competitiveness as financial hubs. The consultation papers, available on IFSCA's website, include specific proposals that would clarify the impact on market participants.

The SEC and Treasury published their semi-annual Regulatory Flexibility Agendas on 2026-08-13 (91 FR 53164 for the SEC), listing rulemaking actions expected in the next 12 months. The SEC's agenda includes 20 proposed rule entries, with plans to rescind the climate-related disclosure rules adopted on March 6, 2024, and to propose rules on crypto assets. Treasury's agenda includes revisions to customer due diligence, customer identification programs for investment advisers, and anti-money laundering programs for stablecoin issuers. These agendas signal the direction of regulatory priorities, affecting compliance costs for financial institutions and the pace of crypto market integration. The agendas were published in the Federal Register on August 13, 2026; comments are due by September 14, 2026, and the actual proposals will determine the impact.

The Bank of Russia proposes to let brokers, managers, forex dealers, and digital currency exchanges count digital currencies in their own funds and capital adequacy calculations, but with a strict 25% cap and a concentration charge. The draft directive, based on Federal Law No. 282-FZ of August 4, 2026, would only recognize digital currencies held in the Russian digital depository's information system and admitted to trading by a Russian trade organizer. These assets are valued at book value up to 25% of total assets accepted for own funds calculation under Ordinance No. 5099-U; repo-transferred digital currencies are valued at no more than the cash received if the second leg matures within 90 days.

For capital adequacy, the sum of core and additional capital is reduced by a concentration charge (KCV), calculated as max(0; net investments - 25% * capital). Digital currencies not admitted to organized trading are fully deducted from capital, as are digital currencies for which a broker acting as digital depository provides services, unless the broker only executes client orders. For market risk, the adjustment coefficient for admitted digital currencies is the clearing house's risk rate multiplied by 2, or 100% if no such rate exists; for non-admitted ones, it is 100%. Digital currencies are valued at fair value under IFRS 13. The directive excludes credit institutions, VEB.RF, and certain fund managers, and takes effect 10 days after publication; comments are accepted from August 14 to August 29, 2026.

Ghana's capital market staged a strong recovery in 2025, with the GSE Composite Index up 79.4% and fixed income trade volumes up 41% to GH¢245.85 billion, driven by macroeconomic stabilisation (real GDP growth 6.0%, inflation down to 5.4%) and regulatory reforms. The GSE Financial Stocks Index surged by 95.2%, and market capitalisation expanded by 54.5% to GH¢172.04 billion. Assets under management surpassed GH¢107 billion, a 25.7% increase, while the number of licensed market operators rose to 306 from 299. The fixed income market demonstrated a decisive recovery, driven by improved liquidity conditions, yield compression, and the progressive restoration of market depth in the aftermath of the 2023 debt restructuring exercise.

The Commission's finances deteriorated sharply: it recorded a deficit of GH¢3.27 million in 2025 against a surplus of GH¢21.41 million in 2024, which had included GH¢20 million government support. Operational income rose 9.63% to GH¢61.24 million, but operating expenditure increased 18.48% to GH¢64.51 million. Transaction levy jumped 77.49% to GH¢27.66 million, while prospectus approval fees fell 78.91% to GH¢3.41 million. The Commission expects market conditions to continue stabilising in 2026, supported by targeted policy interventions and sustained regulatory oversight, and plans to finalise fees on pension assets and introduce other revenue measures, including a levy on assets under management and licensing of virtual asset service providers.

Residual risks from the Domestic Debt Exchange Programme and global economic uncertainties remain, and activity on the Ghana Commodity Exchange moderated due to weak demand and supply-side constraints. The market recovery supports the government's domestic debt refinancing and the Bank of Ghana's monetary policy transmission, as regulatory reforms—such as CSD Rules and the VASP Act—aim to deepen market infrastructure and attract investment.

Peru's external sector strengthened markedly in June 2026, with exports surging 23.4% year-on-year to USD 8,906 million and imports rising 29.7% to USD 5,737 million. The trade surplus widened accordingly, driven by a 30.2% jump in traditional exports, led by mining (up 35.2% to USD 6,429 million), while non-traditional exports grew only 1.2%. Import growth was fueled by capital goods (up 39.2%) and transport equipment (up 61.5%), reflecting robust domestic investment demand. Terms of trade improved 11.2% year-on-year, as export prices rose 26.6%.

The central bank's monetary operations show a tightening bias: sterilization operations (CD BCRP, deposits) exceeded liquidity injections, and the interbank rate in soles averaged 4.25% annually in early August, with the corporate prime rate at 90 days rising to 4.70% from 4.65% in June. Primary issuance fell by S/ 4,352 million between August 3 and 11, but is up S/ 14,568 million since end-2025. The sol depreciated slightly, closing at S/ 3.3660 per USD on August 11, down 0.97% from August 3, with a cumulative depreciation of only 0.06% since end-2025, contrasting sharply with Colombia (-16.91%) and Mexico (-5.13%). Net international reserves stood at USD 99,298 million, equivalent to 28% of GDP.

These figures, compiled from SUNAT, MINEM, and BCRP, with some export data supplemented by MINEM and firm reports, signal a resilient external position and a cautious monetary stance. The sterilization operations and rising short-term rates suggest the BCRP is managing liquidity to contain inflation, which could keep short-term bond yields elevated. However, the fall in CD BCRP yields across all tenors between August 4 and 12 indicates market expectations of easing, creating a tension between policy signals and market pricing.