Unconventional Monetary Policies in Emerging Markets and Frontier Countries

Author/Editor:

Chiara Fratto ; Brendan Harnoys Vannier ; Borislava Mircheva ; David de Padua ; Helene Poirson Ward

Publication Date:

January 22, 2021

Electronic Access:

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Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

The COVID-19 crisis induced an unprecedented launch of unconventional monetary policy through asset purchase programs (APPs) by emerging market and developing economies. This paper presents a new dataset of APP announcements and implementation from March until August 2020 for 27 emerging markets and 8 small advanced economies. APPs’ effects on bond yields, exchange rates, equities, and debt spreads are estimated using different methodologies. The results confirm that APPs were successful in significantly reducing bond yields in EMDEs, and these effects were stronger than those of policy rate cuts, suggesting that such UMP could be important tools for EMDEs during financial market stress.

Series:

Working Paper No. 2021/014

Frequency:

regular

English

Publication Date:

January 22, 2021

ISBN/ISSN:

9781513567211/1018-5941

Stock No:

WPIEA2021014

Format:

Paper

Pages:

71

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