I don't think we should have actually done that

Irelands being pinned to the collar by the ECB to get rid the bonds they issued as part of their prom note last year due to the fact that the ECB are worried €25 billion of prom notes into sovereign debt equated to monetary financing, something that is forbidden by article 123 of the EU Treaty. The Central Bank of Ireland agreed last year to sell the bonds “but only where such a sale is not disruptive to financial stability”. The weighted average life of the long-term government bonds is 34 to 35 years, compared to seven or eight years for the promissory notes. ECB chief Mario Draghi said at the time that while the ECB had taken note of the transaction it would be reviewing the arrangement as part of its monitoring of monetary financing in euro zone countries.

But our banks are different

The ECB determination to subject the euro zone's largest banks to the same, rigorous checks is being tested, with countries lobbying for their banks to be treated differently and lenders asking for their workload to be eased.

Almost two weeks after the ECB published a 285 page manual spelling out how it will examine banks' trillions of euros of assets, lenders in Germany and Spain are leading the charge for special treatment, while banks across the eurozone have asked for changes to the process to make it less onerous.

The central bank is carrying out the wide-ranging tests so it can start with a clean sheet when it becomes the euro zone's banking supervisor in November. The tests are designed to banish lingering investor doubts about the health of the region's banks that have kept their valuations consistently below U.S. peers.

We shouldn't be too cosy and trusting with the banks.Thanks for stating the bleedin obvious

The Bank of England needs to abandon a culture of cosy chats and too much trust in banks following the latest financial scandal to hit London, former policy maker Adam Posen has said.

Mr Posen, who served on the central bank's Monetary Policy Committee from 2009 to 2012, said BoE staff had had too much confidence that banks would regulate themselves and would root out bad behaviour by their own traders.

 Adam Posen

"What is really most important is to see the Bank of England get away from being so trusting of the banks. That was the culture for a long time. It was not corrupt, it was just badly mistaken," he told the BBC.

Earlier this month the BoE suspended an official as part of an ongoing investigation into whether the central bank had turned a blind eye to the alleged rigging of exchange rates in London's $2.1 trillion-a-day currency market.

Mr Posen welcomed Ms Shafik's appointment, and the promotion of his MPC colleague, Ben Broadbent, to become deputy governor for monetary policy.

But he said that it would be more important to change a culture of too much trust in banks, which had also afflicted other central banks, including the US Federal Reserve.

"There has to be a top-down explicit statement that our bias is towards having market solutions, not cosy conversations with individual bankers, that the Bank of England is neither the friend nor the enemy of the banks," he said.

Mr Posen also criticised the forward guidance policy on interest rates that Mr Carney launched in August, calling it "irresponsible" for encouraging the public to focus on a single economic indicator - unemployment - as a guide to when interest rates would rise.

He welcomed a change to the policy last month, when the central bank said it would look at a wider range of data after unemployment fell to the 7pc threshold set in August.

Mr Posen, who now heads the Washington-based Peterson Institute for International Economics, also praised the open discussion at MPC meetings and joked that the biscuits served to policymakers were "cheap but fattening".

Inflations down,but its nothing we can't handel

Canada’s inflation rate slowed in February but stayed within the central bank’s comfort zone, news that may reassure policymakers somewhat but is unlikely to trigger a change in their neutral stance on interest rates.

Consumer prices rose 1.1 per cent in the year to February, down from a 1-1/2-year high of 1.5 per cent in January but above the market forecast of a 0.9 per cent increase, Statistics Canada data showed on Friday. Lower gasoline prices partially offset higher shelter and food costs in February, it said.

The Banks are actually sound-Who knew?

The Fed  has concluded that almost all of the country's biggest banks could withstand a severe economic downturn.

 29 of the country's 30 biggest banks -- excluding a regional bank in the western U.S. -- have enough money on hand to withstand a hypothetical deep recession. Such a downturn would include a sharp rise in unemployment, a nearly 50 percent drop in the country's major stock indexes and a steep drop in home prices.

The central bank said the annual survey of the banks shows broad improvement in their financial standing since the country's recession five years ago, its worst in seven decades.

Analysts say that the better outlook for the banks could allow them to again pay dividends to their shareholders for the first time in recent years. One survey of bank profits showed that the six biggest U.S. banks earned $76 billion in profits last year, close to their collective all-time high.

Meanwhile, the Fitch credit rating agency has issued a AAA rating with a stable outlook for the United States.

Fitch made the announcement Friday, saying the new action resolved the negative watch the U.S. received in October.

The agency noted that last year's U.S. debt ceiling crises had not negatively affected U.S. bond yields or reduced foreign holdings of Treasury securities. Fitch said, "therefore Fitch does not believe the role of the U.S. dollar, sovereign financing flexibility or debt tolerance has been materially damaged." The ratings agency said the U.S. has achieved "strong fiscal consolidation."

The agency said the U.S. economy is one of the most "productive, dynamic and technologically advanced in the world," underpinned by strong institutions, a favorable business climate and efficient product and labor markets.

Fitch said the U.S. has greater debt tolerance than its AAA peers, owing to the "unparalleled financing flexibility provided by being the issuer of the world's pre-eminent reserve currency and benchmark fixed income asset."

Fitch said the country's capital markets are "the deepest and most liquid in the world."

Some information for this report was provided by Reuters.

Investor confidence up but only because there is more of us to invest in.

The eurozone's current account surplus grew to 25.3 billion euros ($35 billion) in January, European Central Bank data showed Friday, incorporating new eurozone member Latvia for the first time. 

The monthly figure compared to a surplus of 20 billion euros for December, according to revised data. 

The current account on the balance of payments, which includes payments for imports and exports in both goods and services plus all other current transfers, is a closely tracked  indicator of the ability of a country or area to pay its way in the world. 

It is crucial for the long-term confidence of investors and trading partners, and an important factor in the value of a currency, in this case the euro, on the foreign exchange market. 

Over the 12 months to January, the current account showed a surplus of 227.9 billion euros, compared with a surplus of 135.4 billion euros a year earlier, the data showed. 

Give us back the cash lads.You didn't think it was a handout.

 Banks will return 18.90 billion euros (£15.79 billion) in crisis loans to the European Central Bank next week, a much larger sum than expected that will keep up the drain of extra cash out of the euro zone financial system.

The amount banks will repay on March 26 is more than this week's repayments of 10.075 billion euros and is also far above the 7 billion forecast in a Reuters poll. 

To help lenders ride out funding constraints, the ECB lent banks more than one trillion euros in three-year loans during the euro zone's debt crisis, in December 2011 and February 2012. Since January of last year, banks have repaid more than half of those loans.

The speed with which banks have been repaying the three-year loans has picked up over recent weeks again as confidence returns and banks start to rely less on central bank funding.

Banks seem keen to offload their LTROs to shape up their balance sheets ahead of the ECB's forthcoming asset review.

With banks repaying ECB crisis loans, the amount of excess liquidity - the amount of money banks have beyond what they need for their day-to-day operations - is falling.

It stood at 122 billion euros on Friday. Excess liquidity peaked in early 2012 at around 800 billion euros.

On Friday, the ECB said 12 banks would repay 6.411 billion euros from the first LTRO on March 26, and 15 banks would pay back 12.498 billion from the second LTRO.

(Reporting by Frankfurt newsroom)(Reuters)