Differential Effects Of Macroprudential Policy

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Differential Effects of Macroprudential Policy

Nina Biljanovska,Sophia Chen
Differential Effects of Macroprudential Policy Book PDF

Author : Nina Biljanovska,Sophia Chen
Publisher : International Monetary Fund
Page : 45 pages
File Size : 51,7 Mb
Release : 2023-02-24
Category : Business & Economics
ISBN : 9798400235719

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Differential Effects of Macroprudential Policy by Nina Biljanovska,Sophia Chen Pdf

We explore the differential effects of lender-based macroprudential policies on new mortgage borrowing for households of different income using a comprehensive dataset that links macroprudential policy actions with household survey data for European Union countries. The main results suggest that higher-income households on average experience a larger reduction in mortgage loan size than lower-income households when regulation targeting total lenders’ assets tightens. In contrast, lower-income households on average experience a larger reduction in mortgage loan size than higher-income households when regulation targeting lenders’ capital requirements tightens. We also provide evidence of the different channels through which the differential effects operate.

The Micro Impact of Macroprudential Policies: Firm-Level Evidence

Meghana Ayyagari,Thorsten Beck,Mr.Maria Soledad Martinez Peria
The Micro Impact of Macroprudential Policies Firm Level Evidence Book PDF

Author : Meghana Ayyagari,Thorsten Beck,Mr.Maria Soledad Martinez Peria
Publisher : International Monetary Fund
Page : 65 pages
File Size : 51,8 Mb
Release : 2018-12-07
Category : Business & Economics
ISBN : 9781484385654

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The Micro Impact of Macroprudential Policies: Firm-Level Evidence by Meghana Ayyagari,Thorsten Beck,Mr.Maria Soledad Martinez Peria Pdf

Combining balance sheet data on 900,000 firms from 48 countries with information on the adoption of macroprudential policies during 2003-2011, we find that these policies are associated with lower credit growth. These effects are especially significant for micro, small and medium enterprises (MSMEs) and young firms that, according to the literature, are more financially constrained and bank dependent. Among MSMEs and young firms, those with weaker balance sheets exhibit lower credit growth in conjunction with the adoption of macroprudential policies, suggesting that these policies can enhance financial stability. Finally, our results show that macroprudential policies have real effects, as they are associated with lower investment and sales growth.

Key Aspects of Macroprudential Policy - Background Paper

International Monetary Fund. Fiscal Affairs Dept.,International Monetary Fund. Monetary and Capital Markets Department
Key Aspects of Macroprudential Policy Background Paper Book PDF

Author : International Monetary Fund. Fiscal Affairs Dept.,International Monetary Fund. Monetary and Capital Markets Department
Publisher : International Monetary Fund
Page : 64 pages
File Size : 40,6 Mb
Release : 2013-10-06
Category : Business & Economics
ISBN : 9781498341714

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Key Aspects of Macroprudential Policy - Background Paper by International Monetary Fund. Fiscal Affairs Dept.,International Monetary Fund. Monetary and Capital Markets Department Pdf

The countercyclical capital buffer (CCB) was proposed by the Basel committee to increase the resilience of the banking sector to negative shocks. The interactions between banking sector losses and the real economy highlight the importance of building a capital buffer in periods when systemic risks are rising. Basel III introduces a framework for a time-varying capital buffer on top of the minimum capital requirement and another time-invariant buffer (the conservation buffer). The CCB aims to make banks more resilient against imbalances in credit markets and thereby enhance medium-term prospects of the economy—in good times when system-wide risks are growing, the regulators could impose the CCB which would help the banks to withstand losses in bad times.

Macroprudential Policy - An Organizing Framework - Background Paper

International Monetary Fund. Monetary and Capital Markets Department
Macroprudential Policy An Organizing Framework Background Paper Book PDF

Author : International Monetary Fund. Monetary and Capital Markets Department
Publisher : International Monetary Fund
Page : 33 pages
File Size : 49,5 Mb
Release : 2011-03-14
Category : Business & Economics
ISBN : 9781498339179

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Macroprudential Policy - An Organizing Framework - Background Paper by International Monetary Fund. Monetary and Capital Markets Department Pdf

MCM conducted a survey in December 2010 to take stock of international experiences with financial stability and the evolving macroprudential policy framework. The survey was designed to seek information in three broad areas: the institutional setup for macroprudential policy, the analytical approach to systemic risk monitoring, and the macroprudential policy toolkit. The survey was sent to 63 countries and the European Central Bank (ECB), including all countries in the G-20 and those subject to mandatory Financial Sector Assessment Programs (FSAPs). The target list is designed to cover a broad range of jurisdictions in all regions, but more weight is given to economies that are systemically important (see Annex for details). The response rate is 80 percent. This note provides a summary of the survey’s main findings.

Staff Guidance Note on Macroprudential Policy

International Monetary Fund
Staff Guidance Note on Macroprudential Policy Book PDF

Author : International Monetary Fund
Publisher : International Monetary Fund
Page : 45 pages
File Size : 48,8 Mb
Release : 2014-06-11
Category : Business & Economics
ISBN : 9781498342629

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Staff Guidance Note on Macroprudential Policy by International Monetary Fund Pdf

This note provides guidance to facilitate the staff’s advice on macroprudential policy in Fund surveillance. It elaborates on the principles set out in the “Key Aspects of Macroprudential Policy,” taking into account the work of international standard setters as well as the evolving country experience with macroprudential policy. The main note is accompanied by supplements offering Detailed Guidance on Instruments and Considerations for Low Income Countries

Household Credit, Global Financial Cycle, and Macroprudential Policies

Mircea Epure,Irina Mihai,Ms.Camelia Minoiu,José-Luis Peydró
Household Credit Global Financial Cycle and Macroprudential Policies Book PDF

Author : Mircea Epure,Irina Mihai,Ms.Camelia Minoiu,José-Luis Peydró
Publisher : International Monetary Fund
Page : 81 pages
File Size : 54,7 Mb
Release : 2018-01-24
Category : Business & Economics
ISBN : 9781484338926

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Household Credit, Global Financial Cycle, and Macroprudential Policies by Mircea Epure,Irina Mihai,Ms.Camelia Minoiu,José-Luis Peydró Pdf

We analyze the effects of macroprudential policies on local bank credit cycles and interactions with international financial conditions. For identification, we exploit the comprehensive credit register containing all bank loans to individuals in Romania, a small open economy subject to external shocks, and the period 2004-2012, which covers a full boom-bust credit cycle when a wide range of macroprudential measures were deployed. Although household leverage is known to be a key driver of financial crises, to our knowledge this is the first paper that employs a household credit register to study leverage and macroprudential policies over a full economic cycle. Our results show that tighter macroprudential conditions are associated with a significant decline in household credit, with substantially stronger effects for foreign currency (FX) loans than for local currency loans. The effects on FX loans are higher for: (i) ex-ante riskier borrowers proxied by higher debt-service-toincome ratios and (ii) banks with greater exposure to foreign funding. Moreover, tighter macroprudential policy has stronger dampening effects on FX lending when global risk appetite is high and foreign monetary policy is expansionary. Finally, quantitative effects are in general larger for borrower rather than lender macroprudential policies.

Effects of Monetary and Macroprudential Policies on Financial Conditions

Ms.Aleksandra Zdzienicka,Ms.Sally Chen,Federico Diaz Kalan,Stefan Laseen,Katsiaryna Svirydzenka
Effects of Monetary and Macroprudential Policies on Financial Conditions Book PDF

Author : Ms.Aleksandra Zdzienicka,Ms.Sally Chen,Federico Diaz Kalan,Stefan Laseen,Katsiaryna Svirydzenka
Publisher : International Monetary Fund
Page : 29 pages
File Size : 55,9 Mb
Release : 2015-12-31
Category : Business & Economics
ISBN : 9781513519159

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Effects of Monetary and Macroprudential Policies on Financial Conditions by Ms.Aleksandra Zdzienicka,Ms.Sally Chen,Federico Diaz Kalan,Stefan Laseen,Katsiaryna Svirydzenka Pdf

The Global Financial Crisis has reopened discussions on the role of the monetary policy in preserving financial stability. Determining whether monetary policy affects financial variables domestically—especially compared to the effects of macroprudential policies— and across borders, is crucial in this context. This paper looks into these issues using U.S. exogenous monetary policy shocks and macroprudential policy measures. Estimates indicate that monetary policy shocks have significant and persistent effects on financial conditions and can attenuate long-term financial instability. In contrast, the impact of macroprudential policy measures is generally more immediate but shorter-lasting. Also, while an exogenous increase in U.S. monetary policy rates tends to reduce credit and house prices in other countries—with the effects varying with country-specific characteristics—an increase driven by improved U.S. economic conditions tends to have the opposite effect. Finally, we do not find evidence of cross-border spillover effects associated with U.S. macroprudential policies.

An Overview of Macroprudential Policy Tools

Mr.Stijn Claessens
An Overview of Macroprudential Policy Tools Book PDF

Author : Mr.Stijn Claessens
Publisher : International Monetary Fund
Page : 38 pages
File Size : 46,9 Mb
Release : 2014-12-11
Category : Business & Economics
ISBN : 9781498340939

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An Overview of Macroprudential Policy Tools by Mr.Stijn Claessens Pdf

Macroprudential policies – caps on loan to value ratios, limits on credit growth and other balance sheets restrictions, (countercyclical) capital and reserve requirements and surcharges, and Pigouvian levies – have become part of the policy paradigm in emerging markets and advanced countries alike. But knowledge is still limited on these tools. Macroprudential policies ought to be motivated by market failures and externalities, but these can be hard to identify. They can also interact with various other policies, such as monetary and microprudential, raising coordination issues. Some countries, especially emerging markets, have used these tools and analyses suggest that some can reduce procyclicality and crisis risks. Yet, much remains to be studied, including tools’ costs ? by adversely affecting resource allocations; how to best adapt tools to country circumstances; and preferred institutional designs, including how to address political economy risks. As such, policy makers should move carefully in adopting tools.

Dealing with the Challenges of Macro Financial Linkages in Emerging Markets

Otaviano Canuto,Swati Ghosh
Dealing with the Challenges of Macro Financial Linkages in Emerging Markets Book PDF

Author : Otaviano Canuto,Swati Ghosh
Publisher : World Bank Publications
Page : 307 pages
File Size : 47,7 Mb
Release : 2013-10-29
Category : Business & Economics
ISBN : 9781464800030

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Dealing with the Challenges of Macro Financial Linkages in Emerging Markets by Otaviano Canuto,Swati Ghosh Pdf

This book deals with the challenges of macro financial linkages in the emerging markets.

The Interaction of Monetary and Macroprudential Policies - Background Paper

International Monetary Fund. Monetary and Capital Markets Department,International Monetary Fund. Western Hemisphere Dept.,International Monetary Fund. European Dept.
The Interaction of Monetary and Macroprudential Policies Background Paper Book PDF

Author : International Monetary Fund. Monetary and Capital Markets Department,International Monetary Fund. Western Hemisphere Dept.,International Monetary Fund. European Dept.
Publisher : International Monetary Fund
Page : 68 pages
File Size : 40,7 Mb
Release : 2012-12-27
Category : Business & Economics
ISBN : 9781498339513

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The Interaction of Monetary and Macroprudential Policies - Background Paper by International Monetary Fund. Monetary and Capital Markets Department,International Monetary Fund. Western Hemisphere Dept.,International Monetary Fund. European Dept. Pdf

This paper provides background material to support the Board paper on the interaction of monetary and macroprudential policies. It analyzes the scope for and evidence on interactions between monetary and macroprudential policies. It first reviews a recent conceptual literature on interactive effects that arise when both macroprudential and monetary policy are employed. It goes on to explore the “side effects” of monetary policy on financial stability and their implications for macroprudential policy. It finally addresses the strength of possible effects of macroprudential policies on output and price stability, and draws out implications for the conduct of monetary policy.

Macro-Prudential Policies to Mitigate Financial System Vulnerabilities

Mr.Stijn Claessens,Swati R. Ghosh,MissRoxana Mihet
Macro Prudential Policies to Mitigate Financial System Vulnerabilities Book PDF

Author : Mr.Stijn Claessens,Swati R. Ghosh,MissRoxana Mihet
Publisher : International Monetary Fund
Page : 36 pages
File Size : 52,8 Mb
Release : 2014-08-19
Category : Business & Economics
ISBN : 9781498357609

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Macro-Prudential Policies to Mitigate Financial System Vulnerabilities by Mr.Stijn Claessens,Swati R. Ghosh,MissRoxana Mihet Pdf

Macro-prudential policies aimed at mitigating systemic financial risks have become part of the policy toolkit in many emerging markets and some advanced countries. Their effectiveness and efficacy are not well-known, however. Using panel data regressions, we analyze how changes in balance sheets of some 2,800 banks in 48 countries over 2000–2010 respond to specific macro-prudential policies. Controlling for endogeneity, we find that measures aimed at borrowers––caps on debt-to-income and loan-to-value ratios––and at financial institutions––limits on credit growth and foreign currency lending––are effective in reducing asset growth. Countercyclical buffers are little effective through the cycle, and some measures are even counterproductive during downswings, serving to aggravate declines, consistent with the ex-ante nature of macro-prudential tools.

How Effective is Macroprudential Policy? Evidence from Lending Restriction Measures in EU Countries

Mr.Tigran Poghosyan
How Effective is Macroprudential Policy Evidence from Lending Restriction Measures in EU Countries Book PDF

Author : Mr.Tigran Poghosyan
Publisher : International Monetary Fund
Page : 42 pages
File Size : 44,9 Mb
Release : 2019-03-01
Category : Business & Economics
ISBN : 9781498301909

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How Effective is Macroprudential Policy? Evidence from Lending Restriction Measures in EU Countries by Mr.Tigran Poghosyan Pdf

This paper assesses the effectiveness of lending restriction measures, such as loan-to-value and debt-service-to-income ratios, in affecting developments in house prices and credit. We use data on 99 lending standard restrictions implemented in 28 EU countries over 1990–2018. The results suggest that lending restriction measures are generally effective in curbing house prices and credit. However, the impact is delayed and reaches its peak only after three years. In addition, the impact is asymmetric, with tightening measures having weaker association with target variables compared to loosening measures. The association is stronger in countries outside of euro area and for legally-binding measures and measures involving sanctions. The results have practical implications for macroprudential authorities.

Optimal Macroprudential Policy and Asset Price Bubbles

Nina Biljanovska,Lucyna Gornicka,Alexandros Vardoulakis
Optimal Macroprudential Policy and Asset Price Bubbles Book PDF

Author : Nina Biljanovska,Lucyna Gornicka,Alexandros Vardoulakis
Publisher : International Monetary Fund
Page : 51 pages
File Size : 40,5 Mb
Release : 2019-08-30
Category : Business & Economics
ISBN : 9781513512662

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Optimal Macroprudential Policy and Asset Price Bubbles by Nina Biljanovska,Lucyna Gornicka,Alexandros Vardoulakis Pdf

An asset bubble relaxes collateral constraints and increases borrowing by credit-constrained agents. At the same time, as the bubble deflates when constraints start binding, it amplifies downturns. We show analytically and quantitatively that the macroprudential policy should optimally respond to building asset price bubbles non-monotonically depending on the underlying level of indebtedness. If the level of debt is moderate, policy should accommodate the bubble to reduce the incidence of a binding collateral constraint. If debt is elevated, policy should lean against the bubble more aggressively to mitigate the pecuniary externalities from a deflating bubble when constraints bind.

Macro-financial Stability Policy In A Globalised World: Lessons From International Experience - Selected Papers From The Asian Monetary Policy Forum 2021 Special Edition And Mas-bis Conference

Edward S Robinson,Claudio Borio,Hyun Song Shin
Macro financial Stability Policy In A Globalised World Lessons From International Experience Selected Papers From The Asian Monetary Policy Forum 2021 Special Edition And Mas bis Conference Book PDF

Author : Edward S Robinson,Claudio Borio,Hyun Song Shin
Publisher : World Scientific
Page : 724 pages
File Size : 48,6 Mb
Release : 2022-12-28
Category : Business & Economics
ISBN : 9789811259449

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Macro-financial Stability Policy In A Globalised World: Lessons From International Experience - Selected Papers From The Asian Monetary Policy Forum 2021 Special Edition And Mas-bis Conference by Edward S Robinson,Claudio Borio,Hyun Song Shin Pdf

Since at least the Great Financial Crisis, authorities around the world have increasingly relied on macroprudential policy to help secure financial stability and complement monetary policy as an integral element of a broader macro-financial stability framework. In today's interconnected global financial system, policy actions taken by the major advanced economies can have spillovers on the rest of the world through their impact on capital flows and exchange rates, potentially generating vulnerabilities across borders. Conversely, in emerging market economies, macroprudential policy as well as foreign exchange intervention and/or capital flow management policy can help mitigate the corresponding impact. This can in turn generate spillbacks on advanced economies — spillbacks that have become more sizeable as the emerging market economies' heft in the world has grown. Yet little is known about these interactions.The contents of this book are based on a conference held on 26-28 May 2021 and jointly hosted by the Monetary Authority of Singapore (MAS) and the Bank for International Settlements (BIS). It aims to contribute to existing literature on macro-financial policymaking by providing an overall conceptual framework and documenting the latest global trends and country experiences. In particular, it highlights the role of international spillovers and spillbacks, paying particular attention to emerging market economies. This book is essential reading for academics, graduate students and economic professionals. It can also serve as a handbook for policymakers at central banks, regulatory authorities and other government agencies tasked with designing and implementing macroprudential or more generally macro-financial stability policies. The book will also be of interest to researchers at international organisations.

Macroprudential Policy and Practice

Paul Mizen,Margarita Rubio,Philip Turner
Macroprudential Policy and Practice Book PDF

Author : Paul Mizen,Margarita Rubio,Philip Turner
Publisher : Cambridge University Press
Page : 325 pages
File Size : 44,6 Mb
Release : 2018-08-23
Category : Business & Economics
ISBN : 9781108419901

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Macroprudential Policy and Practice by Paul Mizen,Margarita Rubio,Philip Turner Pdf

A guide to the latest theoretical developments in macroprudential policy, the newest tool in central banking policymaking circles.