Claire Jones The week ahead in central banking

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Both the European Central Bank and the Bank of England will vote on monetary policy on Thursday.

The Monetary Policy Committee decision is out at noon local time (11.00 GMT). According to a Reuters poll, most expect the Bank to hold rates and maintain the stock of asset purchases at £200bn. However, a significant minority predict more QE, with most of these believing that £50bn is the amount that the MPC is most likely to plump for.

Though those expecting more QE in October are in the minority, the bulk of analysts do believe the Bank will expand its asset purchases at some point in the near future, with November considered the most likely option. The Bank also publishes the minutes of its FPC meeting on Monday at 09.30 local time (08.30 GMT), which may shed some light on the rather ambiguous statement that came out this week. 

Most expect the Governing Council to hold the main refinancing rate at 1.5 per cent, though one-in-five predict a quarter point cut. More likely is that the council opt for measures to ease liquidity strains, possibly through offering 12-month loans to the eurozone’s banks. The decision is announced at 13.45 local time (11.45 GMT).  Jean-Claude Trichet, the ECB president, will meet the press in the hours following the decision. Expect questions on the possibility of a Greek default and the leveraging of the European Financial Stability Facility. It will be his last decision at the helm before Mario Draghi takes over next month. Expect a valedictory address from the departing president.

Elsewhere, the Bank of Japan looks set to leave rates unchanged at 0-0.1 per cent on Friday. The BoJ also publishes its influential Tankan survey of business sentiment for the third quarter on Monday. The Reserve Bank of Australia sets its policy rate on Tuesday. Expect its Board to hold rates at 4.75 per cent.

Other central banks voting on monetary policy this week are Peru (Monday), Hungary (Tuesday), Poland and Kenya (Wednesday) and Serbia (Thursday).

The Central Bank of Iceland publishes the minutes of its 21 September rate vote on Wednesday.

Financial stability

The Financial Stability Board meets in Zurich on Monday to finalise the proposals for a capital surcharge for the biggest and most interconnected banks. The FSB will also discuss crisis resolution.

Tim Geithner presents the first annual report of the Financial Stability Oversight Council, the body charged with safeguarding financial stability in the US, to the House Committee on Financial Services. The hearing begins at 14.00 local time (18.00 GMT).

Central bank speak

On Tuesday, Fed chairman Ben Bernanke will testify before Congress’s Joint Economic Committee which counts Senator Bernie Sanders, one of the central bank’s most vociferous critics, as a member. Testimony begins at 10.00 local time (14.00 GMT).

An hour earlier, Mr Trichet’s hearing before the Committee on Economic and Monetary Affairs of the European Parliament will begin in Brussels. His deputy, Vitor Constâncio speaks on securities settlement later in the day, at 17.45 local time (15.45 GMT). Another member of the executive board, Peter Praet, talks on the same topic on Wednesday morning at 09.00 local time (07.00 GMT).

Christian Noyer, the governor of Banque de France, will talk in Tokyo on Monday. His counterpart at the National Bank of Austria, Ewald Nowotny, talks on the same day about the crisis and Basel III.

External MPC member David Miles continues his campaign for higher capital requirements at a Said Business School Conference in Oxford on Tuesday. His remarks are expected at 09.30 local time (08.30 GMT), as are those of Andrew Bailey, the deputy head of the prudential business unit at the Financial Services Authority, who joins Mr Miles at the event. Mr Bailey will cover reform to capital and liquidity requirements.

Chris Salmon, who succeeded Mr Bailey as chief cashier, will talk in Singapore at 10.20 local time (02.20 GMT).

András Simor, the governor of the National Bank of Hungary, will talk in London on Thursday.

Jeffrey Lacker, the president of the Richmond Fed and a non-voting member of the Federal Open Market Committee, talks on economics after the crisis on Monday. His counterpart at the Atlanta Fed, Dennis Lockhart, speaks on the US economy on Friday.