Interaction of Monetary and Macroprudential Policies : Background Paper / International Monetary Fund.

Format:

Book

Author/Creator:

International Monetary Fund, author, issuing body.

Series:

Policy Papers ; Volume 2012: Issue 107

Language:

English

Subjects (All):

Monetary policy.

Physical Description:

1 online resource (67 pages).

Other Title:

Interaction of Monetary and Macroprudential Policies

Place of Publication:

Washington, D.C. : International Monetary Fund, 2012.

Summary:

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.

Contents:

I. INTRODUCTION

II. CONCEPTUAL FRAMEWORK

A. Policy Goals and Assignment of Tools

B. Interactions

III. EXPERIENCES AND LIMITATIONS

A. Imperfect Macroprudential Policies

B. Constraints on Monetary Policy

C. Institutional and Political Economy Considerations

IV. CONCLUSIONS

BOXES

1. Aggregate Consequences of Financial Market Imperfections

2. Channels through Which Monetary Policy Can Affect Financial Stability

3. Interactions Between Monetary and Macroprudential Policies

4. Monetary and Macroprudential Policies in Small Open Economies

FIGURE

1. Policies and Objectives

ANNEXES

I. Price, Output, and Financial Stability

II. Literature on Channels Through Which Monetary Policy Can Affect Financial Stability.

Notes:

Description based on publisher supplied metadata and other sources.

ISBN:

9781498379922

1498379923