TARGET2 is the abbreviation of “Trans-European Automated Real-time Gross Settlement Express Transfer System” – a real-time settlement system developed and maintained by the Eurosystem. The Eurosystem comprises the European Central Bank and national central banks of 19 member states of the European Union.
TARGET2 records claims and liabilities of national central banks, as well as the ECB, against the Eurosystem. A country’s TARGET2 balance is affected by its surpluses/deficits in (i) the current account, (ii) the financial account, and/or (iii) the capital account. It is reminiscent of a swap line operation or a change in foreign reserves under a fixed exchange rate arrangement.
Since October 2011, the Institute of Empirical Economic Research at Osnabrück University has been monitoring the evolution of TARGET2 balances, and Cheung, Steinkamp and Westermann (Journal of International Money & Finance, April 2020) have analysed their empirical determinants.
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Research on Target2 and the Euro Crisis
Journal Articles:
Evergreening
in the Euro Area: Evidence from Survey Data and a Conceptual Framework
Aaron Tornell, Sven Steinkamp & Frank Westermann,
CESifo Economic Studies, 2020.
Capital Flight to
Germany: Two Alternative Measures
Yin-Wong Cheung, Sven Steinkamp & Frank Westermann,
Journal of International Money and Finance, 2020.
Exit
Strategies, Capital Flight and Speculative Attacks: Europe's Version
of the Trilemma
Andreas Steiner, Sven Steinkamp & Frank Westermann,
European Journal of Political Economy, 2019.
Multilateral Loans and
Interest Rates:
Further
Evidence on the Seniority
Conundrum
Sven Steinkamp
& Frank Westermann,
International Journal of Finance and Economics,
2017.
The role of creditor seniority in Europe's sovereign debt crisis
Sven Steinkamp
& Frank Westermann, Economic Policy, 2014.
Valeriya Dinger, Sven Steinkamp & Frank Westermann, Open Economies
Review, 2014.
Frank
Westermann, Economic Policy, 2014.
Sven Steinkamp, Wirtschaftsdienst, 2014.
Selected Recent Press Coverage
Interview Frankfurter Allgemeine Zeitung, August 9 2020
Gastbeitrag in AnlegerPlus,
Ausgabe 5/2019
Gastbeitrag Handelsblatt-Online, Januar 14, 2019
Interview Börsenzeitung,
August 08, 2018