{
  "title": "Interest Rate Pass-Through in Cabo Verde",
  "publication": "Selected Issues Papers, March 10, 2026",
  "sourceUrl": "https://www.imf.org/en/publications/selected-issues-papers/issues/2026/03/10/interest-rate-pass-through-in-cabo-verde-574552",
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  "summary": "This paper estimates the interest rate pass-through in Cabo Verde. Using monthly data since 2001, we estimate a limited pass-through of monetary policy to banks’ lending rates: a 1-percentage-point policy rate change leads to a 0.19–0.28 increase in average lending rates and 0.13–0.",
  "sections": [
    {
      "heading": "Key findings",
      "content": "- Using monthly data since 2001, the paper estimates a limited pass-through of monetary policy to banks’ lending rates.\n- A 1-percentage-point policy rate change leads to:\n  - 0.19–0.28 increase in average lending rates.\n  - 0.13–0.23 increase in long-term rates.\n- Pass-through is roughly twice as strong during tightening than easing cycles but remains weak overall.\n- The pass-through remains weak in the current cycle started in May 2023, underscoring challenges for monetary policy transmission."
    },
    {
      "heading": "Data and empirical scope",
      "content": "- Frequency: monthly data.\n- Sample start: since 2001.\n- Timeframe relevance: includes the current monetary cycle started in May 2023."
    },
    {
      "heading": "Policy and transmission implications",
      "content": "- Limited pass-through implies weaker monetary policy transmission from the central bank policy rate to bank lending rates.\n- Asymmetric response: tightening cycles generate roughly twice the pass-through of easing cycles, suggesting differential transmission depending on policy direction.\n- The weak overall pass-through, including in the current cycle, highlights challenges for achieving monetary policy goals via interest rate adjustments."
    },
    {
      "heading": "Subjects and keywords (as categorized in the source)",
      "content": "- Subjects: Asset and liability management, Bank credit, Central bank policy rate, Commercial banks, Domestic systemically important banks, Excess liquidity, Financial institutions, Financial services, Interest rate policy, Monetary policy, Money.\n- Keywords: Bank credit, BCV interest rate, Cabo Verde, Central bank policy rate, Commercial banks, Domestic systemically important banks, Excess liquidity, Global, IMF country, IMF staff, interest rate channel, interest rate pass-through, Interest rate policy, monetary policy transmission, tightening cycle.\n\n---\n\n Content in this bundle\n\n- Interest Rate Pass-Through in Cabo Verde; IMF Selected Issues Paper No. 2026/019; January 9, 2026\n  - Interest Rate Pass-Through in Cabo Verde; IMF Selected Issues Paper No. 2026/019; January 9, 2026 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Interest Rate Pass-Through in Cabo Verde; IMF Selected Issues Paper No. 2026/019; January 9, 2026 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/selected-issues-papers/issues/2026/03/10/interest-rate-pass-through-in-cabo-verde-574552"
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    "Authors: Bruno Albuquerque, Nombulelo Gumata",
    "Published: March 10, 2026",
    "Series: Selected Issues Papers",
    "DOI: https://doi.org/10.5089/9798229040297.018",
    "Using monthly data since 2001, the paper estimates a limited pass-through of monetary policy to banks’ lending rates.",
    "A 1-percentage-point policy rate change leads to:",
    "Pass-through is roughly twice as strong during tightening than easing cycles but remains weak overall.",
    "The pass-through remains weak in the current cycle started in May 2023, underscoring challenges for monetary policy transmission.",
    "Frequency: monthly data.",
    "Sample start: since 2001.",
    "Timeframe relevance: includes the current monetary cycle started in May 2023.",
    "Limited pass-through implies weaker monetary policy transmission from the central bank policy rate to bank lending rates.",
    "Asymmetric response: tightening cycles generate roughly twice the pass-through of easing cycles, suggesting differential transmission depending on policy direction.",
    "The weak overall pass-through, including in the current cycle, highlights challenges for achieving monetary policy goals via interest rate adjustments.",
    "Subjects: Asset and liability management, Bank credit, Central bank policy rate, Commercial banks, Domestic systemically important banks, Excess liquidity, Financial institutions, Financial services, Interest rate policy, Monetary policy, Money.",
    "Keywords: Bank credit, BCV interest rate, Cabo Verde, Central bank policy rate, Commercial banks, Domestic systemically important banks, Excess liquidity, Global, IMF country, IMF staff, interest rate channel, interest rate pass-through, Interest rate policy, monetary policy transmission, tightening cycle.",
    "**Interest Rate Pass-Through in Cabo Verde; IMF Selected Issues Paper No. 2026/019; January 9, 2026**"
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      "title": "Interest Rate Pass-Through in Cabo Verde; IMF Selected Issues Paper No. 2026/019; January 9, 2026",
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