The Centre for International Finance and Regulation (CIFR) is embarking on two new research projects in a bid to better inform debate and policy around liquidity and risk in Australia and worldwide.
The first of the two major projects will look at global liquidity risk and financial innovation, and focus on the role of institutional investors during the financial crisis of 2008 with particular emphasis on the effect of liquidity risks on stock returns and financial stability. It will also examining whether the heterogeneity of institutional investors matters in liquidity shock transmission. The report will also analyse the effects of financial innovation on liquidity risk.
The second report aims to delve into regional financial integration and stability in the Asia-Pacific region, and consider the implications for Asia of financial sector policy reforms initiated by groups such as the G20, the Bank for International Settlements and the Basel Committee. CIFR said the report will have a particular focus on Australia’s key bilateral financial relationships in the region and on financial market stability, foreign exchange regimes, foreign exchange, systemic and liquidity risks.
CIFR has secured the Institute of Global Finance at the University of NSW to conduct the projects, which will run for three years and be led by Professor Fariborz Moshirian.
CIFR CEO Ros Grady said both epitomise CIFR’s dedicated to relevant research of fundamental importance to the stability of financial markets.
“The research on regional financial integration and stability is extremely timely with the recent release of the current Government’s Asian Century White Paper, and having regard to the opportunities for Australian financial institutions in the region’s markets,” he said.
The two new projects bring CIFR’s tally of research up to 26 since its inception last year.