India: Asset Prices and the Macroeconomy
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Summary:
This paper examines rising asset prices in India. For the most part, asset prices in India reflect structural factors but the risk of a correction cannot be ruled out. However, at this juncture monetary policy may not be the most effective tool to safeguard financial stability because (i) India's economy is undergoing rapid structural change making it difficult to identify price misalignments; (ii) the macroeconomic impact of an asset price correction is likely to be small; and (iii) the relationship between monetary policy and asset prices is also weak. Targeted changes in financial regulations are better tools to address potential risks.
Series:
Working Paper No. 2007/221
Subject:
Asset prices Asset valuation Real estate prices Securities markets Stock markets
English
Publication Date:
September 1, 2007
ISBN/ISSN:
9781451867855/1018-5941
Stock No:
WPIEA2007221
Pages:
21
Please address any questions about this title to publications@imf.org