Unconventional Monetary Policy And Financial Stability

Author : Alexis Stenfors,Jan Toporowski
Publisher : Routledge
Page : 217 pages
File Size : 41,9 Mb
Release : 2020-07-15
Category : Business & Economics
ISBN : 9780429629617

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Unconventional Monetary Policy and Financial Stability by Alexis Stenfors,Jan Toporowski Pdf

Since the financial crisis of 2008-09, central bankers around the world have been forced to abandon conventional monetary policy tools in favour of unconventional policies such as quantitative easing, forward guidance, lowering the interest rate paid on bank reserves into negative territory, and pushing up prices of government bonds. Having faced a crisis in its banking sector nearly a decade earlier, Japan was a pioneer in the use of many of these tools. Unconventional Monetary Policy and Financial Stability critically assesses the measures used by Japan and examines what they have meant for the theory and practice of economic policy. The book shows how in practice unconventional monetary policy has worked through its impact on the financial markets. The text aims to generate an understanding of why such measures were introduced and how the Japanese system has subsequently changed regarding aspects such as governance and corporate balance sheets. It provides a comprehensive study of developments in Japanese money markets with the intent to understand the impact of policy on the debt structures that appear to have caused Japan’s deflation. The topics covered range from central bank communication and policymaking to international financial markets and bank balance sheets. This text is of great interest to students and scholars of banking, international finance, financial markets, political economy, and the Japanese economy.

Author : Naoyuki Yoshino,Pornpinun Chantapacdepong,Matthias Helble
Publisher : Oxford University Press, USA
Page : 345 pages
File Size : 44,5 Mb
Release : 2019
Category : Business & Economics
ISBN : 9780198838104

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Macroeconomic Shocks and Unconventional Monetary Policy by Naoyuki Yoshino,Pornpinun Chantapacdepong,Matthias Helble Pdf

Barely two decades after the Asian financial crisis Asia was suddenly confronted with multiple challenges originating outside the region: the 2008 global financial crisis, the European debt crisis, and finally developed economies' implementation of unconventional monetary policies. The implementation of quantitative easing, ultra-low interest rate policies, and negative interest rate policies by a number of large central banks has given rise to concerns over financial stability and international capital flows. Macroeconomic Shocks and Unconventional Monetary Policy: Impacts on Emerging Markets explains how shocks stemming from the global financial crisis have affected macroeconomic and financial stability in emerging Asia. Macroeconomic Shocks and Unconventional Monetary Policy: Impacts on Emerging Markets brings together the most up-to-date knowledge impacts of recent macroeconomic shocks on Asia's real economy; the spillover effects of macroeconomic shocks on financial markets and flows in Asia; and key challenges for monetary, exchange rate, trade and macro prudential policies of developing Asian economies. It is authored by experts in the field of international macroeconomics from leading academic institutions, central banks, and international organizations including the International Monetary Fund, the Bank for International Settlement, and the Asian Development Bank Institute.

Author : International Monetary Fund. Strategy, Policy, & Review Department,International Monetary Fund. Monetary and Capital Markets Department
Publisher : International Monetary Fund
Page : 40 pages
File Size : 53,9 Mb
Release : 2013-03-09
Category : Business & Economics
ISBN : 9781498341394

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Global Impact and Challenges of Unconventional Monetary Policies by International Monetary Fund. Strategy, Policy, & Review Department,International Monetary Fund. Monetary and Capital Markets Department Pdf

This paper takes stock of unconventional monetary policies (UMP) and their impact so far, and looks ahead towards exit and prospects for policy coordination. It synthesizes earlier staff work on UMP,1 the findings of a substantial and growing academic and central banking literature, as well as further staff analysis contained in the Background Paper. While some widely accepted conclusions have emerged from the large and growing number of studies on UMP, many important questions remain unsettled, as enough time has not elapsed to draw definitive conclusions. In those cases, the paper will pose the relevant questions and provide possible nswers, while recognizing the uncertainty that remains.

Author : Kaufman George G,Evanoff Douglas D,Malliaris Anastasios G
Publisher : World Scientific
Page : 316 pages
File Size : 53,5 Mb
Release : 2000-08-03
Category : Business & Economics
ISBN : 9789813236608

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Innovative Federal Reserve Policies During the Great Financial Crisis by Kaufman George G,Evanoff Douglas D,Malliaris Anastasios G Pdf

This book, Innovative Federal Policies During the Great Financial Crisis, contains discussions of unconventional monetary policies, policy changes to address systemic and payments systems risks, new macroprudential policies, the 'stretching' of the financial safety net, changes in the Fed's liquidity funding facility (the discount window), use of the Fed's balance sheet as a tool of monetary policy, and alternative means to deal with real-estate asset bubbles and potential financial instability. The 10 chapters in this book offer a unique analysis of several innovative approaches by the Federal Reserve that contributed to the stabilization of the US economy following the Great Recession. What unique policies were implemented? Toward what goal? Were they effective? Were there unintended consequences? Additionally, but less thoroughly, events in the Euro market are also discussed, and policies (and their impact) of the ECB are critiqued. Based on papers presented at the 91st Annual Conference of the Western Economic Association International Meetings in Portland, Oregon, 2016, Innovative Federal Policies During the Great Financial Crisis adds significantly to the debate over why innovative or unconventional policies were needed, how they were implemented and how effective they were.

Author : Anonim
Publisher : Unknown
Page : 401 pages
File Size : 54,5 Mb
Release : 2014
Category : Electronic
ISBN : 9291315664

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The Transmission of Unconventional Monetary Policy to the Emerging Markets by Anonim Pdf

Author : International Monetary Fund. Strategy, Policy, & Review Department,International Monetary Fund. Monetary and Capital Markets Department
Publisher : International Monetary Fund
Page : 59 pages
File Size : 43,9 Mb
Release : 2013-03-09
Category : Business & Economics
ISBN : 9781498341349

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Global Impact and Challenges of Unconventional Monetary Policies - Background Paper by International Monetary Fund. Strategy, Policy, & Review Department,International Monetary Fund. Monetary and Capital Markets Department Pdf

This paper provides case studies of 13 of the largest non-UMP countries. The case studies begin with an overview of recent macro-economic developments as well as capital flow patterns during the crisis up to the first U.S. tapering announcement in May 2013. Country experiences with capital inflows are judged along five dimensions: (i) the size of capital inflows, (ii) policies used to manage inflows, (iii) external stability, measured by exchange rate overvaluation and current account deficits relative to fundamentals,2 (iv) asset price and credit market reactions, and (v) financial sector stability. Case studies mostly draw on published IMF Staff Reports for each country, as well as the 2013 Pilot External Stability Report (IMF 2013d).

Author : International Monetary Fund. Fiscal Affairs Dept.,International Monetary Fund. Asia and Pacific Dept,International Monetary Fund. Strategy, Policy, & Review Department,International Monetary Fund. Monetary and Capital Markets Department
Publisher : International Monetary Fund
Page : 49 pages
File Size : 49,8 Mb
Release : 2013-04-18
Category : Business & Economics
ISBN : 9781498341981

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Unconventional Monetary Policies - Recent Experiences and Prospects by International Monetary Fund. Fiscal Affairs Dept.,International Monetary Fund. Asia and Pacific Dept,International Monetary Fund. Strategy, Policy, & Review Department,International Monetary Fund. Monetary and Capital Markets Department Pdf

This paper addresses three questions about unconventional monetary policies. First, what policies were tried, and with what objectives? Second, were policies effective? And third, what role might these policies continue to play in the future?

Author : Frederic Lambert,Mr.Kenichi Ueda
Publisher : International Monetary Fund
Page : 40 pages
File Size : 49,6 Mb
Release : 2014-08-13
Category : Business & Economics
ISBN : 9781498363563

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The Effects of Unconventional Monetary Policies on Bank Soundness by Frederic Lambert,Mr.Kenichi Ueda Pdf

Unconventional monetary policy is often assumed to benefit banks. However, we find little supporting evidence. Rather, we find some evidence for heightened medium-term risks. First, in an event study using a novel instrument for monetary policy surprises, we do not detect clear effects of monetary easing on bank stock valuation but find a deterioration of medium-term bank credit risk in the United States, the euro area, and the United Kingdom. Second, in panel regressions using U.S. banks’ balance sheet information, we show that bank profitability and risk taking are ambiguously affected, while balance sheet repair is delayed.

Author : Matthias Reith
Publisher : GRIN Verlag
Page : 105 pages
File Size : 55,5 Mb
Release : 2015-09-28
Category : Business & Economics
ISBN : 9783640474042

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Unconventional Monetary Policy in Practice. A Comparison of 'Quantitative Easing' in Japan and the USA by Matthias Reith Pdf

Diploma Thesis from the year 2009 in the subject Economics - Finance, grade: 1, University of Vienna, language: English, abstract: In the current economic and financial crisis, many western central banks introduced “unconventional” monetary policy measures, commonly referred to as “Quantitative Easing (QE)”. However, the Bank of Japan (BoJ) already applied QE between 2001 and 2006. This lead many commentators to make oversimplifying comparisons between the BoJ’s QE approach (2001-2006) and current implementations of QE by other central banks. In particular, this diploma thesis tries to examine the differences between BoJ-type QE and Fedtype QE. It turns out that both approaches differ fundamentally from each other on various grounds: The primary aim of QE in Japan was fighting deflation, whereas the American central bank addresses mostly strains in the banking system. Concerning the concrete measures, one can say that QE by the BoJ consisted to a good deal of active QE in terms of outright purchases of Japanese government securities (JGBs), whereas the Fed currently follows a somewhat broader approach: Since interbank markets are not functioning as desired, it tries to engage with as many market participants as direct as possible. Therefore the Fed has introduced a much broader range of new instruments than its Japanese counterpart did between 2001 and 2006. As a result, the Fed’s balance sheet expansion was considerably larger than the one in Japan.

Author : Mr.Etienne B. Yehoue,Kotaro Ishi,Mr.Mark R. Stone
Publisher : International Monetary Fund
Page : 44 pages
File Size : 44,5 Mb
Release : 2009-10-01
Category : Business & Economics
ISBN : 9781451873733

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Unconventional Central Bank Measures for Emerging Economies by Mr.Etienne B. Yehoue,Kotaro Ishi,Mr.Mark R. Stone Pdf

Unconventional central bank measures are playing a key policy role for many advanced economies in the 2007-09 global crisis. Are they playing a similar role for emerging economies? Emerging economies have widely used unconventional foreign exchange and domestic short-term liquidity easing measures. Their use of credit easing and quantitative easing measures has been much more limited. Thus, unconventional measures are much less important for emerging economies compared to advanced economies in achieving broader macroeconomic objectives. The difference can be attributed to the relatively limited financial stress in emerging economies, their external vulnerabilities and their limited scope for quasifiscal activities.

Author : Mr.Dominic Quint,Mr.Pau Rabanal
Publisher : International Monetary Fund
Page : 44 pages
File Size : 49,8 Mb
Release : 2017-03-31
Category : Business & Economics
ISBN : 9781475591392

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Should Unconventional Monetary Policies Become Conventional? by Mr.Dominic Quint,Mr.Pau Rabanal Pdf

The large recession that followed the Global Financial Crisis of 2008-09 triggered unprecedented monetary policy easing around the world. Most central banks in advanced economies deployed new instruments to affect credit conditions and to provide liquidity at a large scale after shortterm policy rates reached their effective lower bound. In this paper, we study if this new set of tools, commonly labeled as unconventional monetary policies (UMP), should still be used when economic conditions and interest rates normalize. In particular, we study the optimality of asset purchase programs by using an estimated non-linear DSGE model with a banking sector and long-term private and public debt for the United States. We find that the benefits of using such UMP in normal times are substantial, equivalent to 1.45 percent of consumption. However, the benefits from using UMP are shock-dependent and mostly arise when the economy is hit by financial shocks. When more traditional business cycle shocks (such as supply and demand shocks) hit the economy, the benefits of using UMP are negligible or zero.

Author : Mr.Mark R. Stone,Kotaro Ishi,Mr.Kenji Fujita
Publisher : International Monetary Fund
Page : 72 pages
File Size : 48,7 Mb
Release : 2011-06-01
Category : Business & Economics
ISBN : 9781455268467

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Should Unconventional Balance Sheet Policies Be Added to the Central Bank toolkit? a Review of the Experience so Far by Mr.Mark R. Stone,Kotaro Ishi,Mr.Kenji Fujita Pdf

What is the case for adding the unconventional balance sheet policies used by major central banks since 2007 to the standard policy toolkit? The record so far suggests that the new liquidity providing policies in support of financial stability generally warrant inclusion. As the balance sheet policies aimed at macroeconomic stability were used only by a small number of highly credible central banks facing a lower bound constraint on conventional interest rate policy, they are not relevant for most central banks or states of the world. Best practices of these policies are documented in this paper.

Author : Mr.Tao Wu
Publisher : International Monetary Fund
Page : 49 pages
File Size : 40,5 Mb
Release : 2014-10-22
Category : Business & Economics
ISBN : 9781498317245

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Unconventional Monetary Policy and Long-Term Interest Rates by Mr.Tao Wu Pdf

This paper examines the transmission mechanism through which unconventional monetary policy affects long-term interest rates. I construct a real-time measure summarizing market projections of the magnitude and duration of the Federal Reserve's Large Scale Asset Purchases (LSAP) program, and analyze the determination of term premiums and expectations of future short-term interest rates in a sample spanning more than two decades. Empirical findings suggest that the LSAP has effectively lowered the long-term Treasury bond yields, through both "signaling" and "portfolio balance" channels. On the other hand, the Fed's "forward guidance" also leads to gradual extension of market projections for the duration of the LSAP program, thereby enhancing the LSAP's effect to keep term premiums low. Estimation results also reveal a diminished effectiveness of the LSAP during QE III. Finally, model simulations underscore the importance of policy transparency in minimizing unnecessary market turbulence and ensuring a timely and smooth exit of the unconventional monetary policy stimulus.

Author : Korbinian Stinglhamer
Publisher : GRIN Verlag
Page : 25 pages
File Size : 54,9 Mb
Release : 2017-10-11
Category : Business & Economics
ISBN : 9783668546165

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Exiting unconventional monetary policy by Korbinian Stinglhamer Pdf

Seminar paper from the year 2016 in the subject Economics - Finance, grade: 1,0, University of Wisconsin-Madison (Economics), course: The Financial System, language: English, abstract: The paper analyzes the unconventional monetary policies that were implemented by the Federal Reserve Bank, the Bank of England, the European Central Bank, and the Bank of Japan during their post-crisis transitions. Next, potential challenges involved in the exit will be analyzed. During the financial crisis many central banks in the world implemented “unconventional monetary policy” measures, such as balance-sheet policies, forward guidance, and negative interest rates. Once the financial system stabilizes, the difficult process of returning back to conventional monetary policy begins. For this reason, this paper analyzes the unconventional monetary policies during post-crisis transitions and potential challenges involved in the exit. The analysis suggests that a transition from unconventional monetary policies should be accomplished smoothly, without exceeding inflation, harming economic recovery, or destabilizing financial markets. Furthermore, the analysis suggests to make use of forward guidance in order to prepare the market for the exit and to increase its potential speed. However, the optimal exiting policy depends largely on present and future economic conditions of the respective currency region. In order to analyze these conditions and determine the ideal exiting strategy for each central bank, further investigations need to be done.

Author : Ulrich Bindseil,Alessio Fotia
Publisher : Springer Nature
Page : 128 pages
File Size : 55,6 Mb
Release : 2021-05-18
Category : Business & Economics
ISBN : 9783030708849

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Introduction to Central Banking by Ulrich Bindseil,Alessio Fotia Pdf

This open access book gives a concise introduction to the practical implementation of monetary policy by modern central banks. It describes the conventional instruments used in advanced economies and the unconventional instruments that have been widely adopted since the financial crisis of 2007–2008. Illuminating the role of central banks in ensuring financial stability and as last resort lenders, it also offers an overview of the international monetary framework. A flow-of-funds framework is used throughout to capture this essential dimension in a consistent and unifying manner, providing a unique and accessible resource on central banking and monetary policy, and its integration with financial stability. Addressed to professionals as well as bachelors and masters students of economics, this book is suitable for a course on economic policy. Useful prerequisites include at least a general idea of the economic institutions of an economy, and knowledge of macroeconomics and monetary economics, but readers need not be familiar with any specific macroeconomic models.