{
  "title": "Does Prolonged Monetary Policy Easing Increase Financial Vulnerability?",
  "publication": "IMF Working Papers, March 24, 2017",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2017/03/24/does-prolonged-monetary-policy-easing-increase-financial-vulnerability-44760",
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  "summary": "Using firm-level data for approximately 1,000 bank and nonbank financial institutions in 22 countries over the past 15 years we study the impact of prolonged monetary policy easing on risk-taking behavior.",
  "sections": [
    {
      "heading": "Study overview",
      "content": "- Authors: Stephen Cecchetti, Tommaso Mancini-Griffoli, Machiko Narita\n- Publication: IMF Working Paper No. 2017/065\n- Date: March 24, 2017\n- Pages: 31\n- DOI: https://doi.org/10.5089/9781475588644.001\n- Sample and scope:\n  - Firm-level data for approximately 1,000 bank and nonbank financial institutions\n  - Coverage: 22 countries\n  - Period: past 15 years"
    },
    {
      "heading": "Key findings on risk-taking and vulnerability",
      "content": "- Leverage and vulnerability:\n  - The leverage ratio increases for banks and nonbanks as domestic monetary policy easing persists.\n  - Other measures of firm-level vulnerability also increase as domestic monetary policy easing persists.\n- Cross-border and spillover effects:\n  - Cross-border effects are notable.\n  - Effects of roughly similar magnitude are observed on foreign financial sector firms when the U.S. eases policy.\n- Non-linearity and timing:\n  - Results appear non-linear, with risk-taking behavior rising most quickly at the onset of monetary policy easing.\n- Robustness:\n  - Results appear robust to a variety of specifications."
    },
    {
      "heading": "Subject areas and keywords (as listed)",
      "content": "- Subject: Accommodative monetary policy; Asset and liability management; Asset management; Banking; Bond yields; Financial institutions; Financial sector policy and analysis; Financial sector risk; Financial services; Investment banking; Monetary policy\n- Keywords include: Accommodative monetary policy; Africa; Asset management; asset-to-equity leverage ratio; Banks; Bond yields; financial institution leverage; Financial sector risk; financial stability; financial vulnerability; Global; interest rate; Investment banking; leverage benchmark; monetary policy; monetary policy easing; monetary policy impulse; monetary policy transmission mechanisms; nonbank financial institutions; nonbank leverage; prolonged monetary policy easing; quarter; risk-taking behavior; spillovers; WP\n\n---\n\n Content in this bundle\n\n- Does Prolonged Monetary Policy Easing Increase Financial Vulnerability?, WP/17/65, March 2017\n  - Does Prolonged Monetary Policy Easing Increase Financial Vulnerability?, WP/17/65, March 2017 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Does Prolonged Monetary Policy Easing Increase Financial Vulnerability?, WP/17/65, March 2017 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2017/03/24/does-prolonged-monetary-policy-easing-increase-financial-vulnerability-44760"
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    "Authors: Stephen Cecchetti, Tommaso Mancini-Griffoli, Machiko Narita",
    "Published: March 24, 2017",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781475588644.001",
    "Authors: Stephen Cecchetti, Tommaso Mancini-Griffoli, Machiko Narita",
    "Publication: IMF Working Paper No. 2017/065",
    "Date: March 24, 2017",
    "Pages: 31",
    "DOI: https://doi.org/10.5089/9781475588644.001",
    "Sample and scope:",
    "Leverage and vulnerability:",
    "Cross-border and spillover effects:",
    "Non-linearity and timing:",
    "Robustness:",
    "Subject: Accommodative monetary policy; Asset and liability management; Asset management; Banking; Bond yields; Financial institutions; Financial sector policy and analysis; Financial sector risk; Financial services; Investment banking; Monetary policy",
    "Keywords include: Accommodative monetary policy; Africa; Asset management; asset-to-equity leverage ratio; Banks; Bond yields; financial institution leverage; Financial sector risk; financial stability; financial vulnerability; Global; interest rate; Investment banking; leverage benchmark; monetary policy; monetary policy easing; monetary policy impulse; monetary policy transmission mechanisms; nonbank financial institutions; nonbank leverage; prolonged monetary policy easing; quarter; risk-taking behavior; spillovers; WP",
    "**Does Prolonged Monetary Policy Easing Increase Financial Vulnerability?, WP/17/65, March 2017**"
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