Monetary and Macroprudential Policies to Manage Capital Flows /

We study interactions between monetary and macroprudential policies in a model with nominal and financial frictions. The latter derive from a financial sector that provides credit and liquidity services that lead to a financial accelerator-cum-fire-sales amplification mechanism. In response to fluct...

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Библиографические подробности
Главный автор: Medina Guzman, Juan Pablo
Другие авторы: Roldos, Jorge
Формат: Журнал
Язык:English
Опубликовано: Washington, D.C. : International Monetary Fund, 2014.
Серии:IMF Working Papers; Working Paper ; No. 2014/030
Online-ссылка:Full text available on IMF
Описание
Итог:We study interactions between monetary and macroprudential policies in a model with nominal and financial frictions. The latter derive from a financial sector that provides credit and liquidity services that lead to a financial accelerator-cum-fire-sales amplification mechanism. In response to fluctuations in world interest rates, inflation targeting dominates standard Taylor rules, but leads to increased volatility in credit and asset prices. The use of a countercyclical macroprudential instrument in addition to the policy rate improves welfare and has important implications for the conduct of monetary policy. 'Leaning against the wind' or augmenting a standard Taylor rule with an argument on credit growth may not be an effective policy response.
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Объем:1 online resource (44 pages)
Формат:Mode of access: Internet
ISSN:1018-5941
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