Czech Republic: Selected Issues and Statistical Appendix
January 9, 2004
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The analysis is structured around the standard taxonomy of transmission channels. A monetary tightening must limit banks' ability to supply loans by reducing bank reserves/bank credit. The direct interest rate channel is the strongest channel of the monetary policy transmission mechanism (MPTM), but the exchange rate channel is weak. The government has started addressing the institutional impediments constraining credit to domestic enterprises. Joining the European economic and monetary unit will strengthen the pass-through from policy rates to lending rates.
Subject: Bank credit, Banking, Credit, Econometric analysis, Exchange rates, Foreign exchange, Money, Nominal effective exchange rate, Vector autoregression
Keywords: Bank credit, CR, Credit, credit market, Europe, exchange rate, exchange rate channel, exchange rate shock, Exchange rates, GDP, interest rate channel, interest rate shock, ISCR, monetary policy shock, Nominal effective exchange rate, Vector autoregression
Pages:
56
Volume:
2004
DOI:
Issue:
003
Series:
Country Report No. 2004/003
Stock No:
1CZEEA0022004
ISBN:
9781451810134
ISSN:
1934-7685
