Emily Liu, Friederike Niepmann, Tim Schmidt-Eisenlohr, 02 February 2020

After the Global Crisis, accommodative monetary policy also eased financial conditions in emerging market economies. This column shows that US banks contributed to the transmission of US monetary policy and that regulation and supervision attenuated it. Only US banks that performed well in the Fed’s annual stress tests expanded their lending to emerging markets in response to monetary easing. Banks that performed poorly left their lending unchanged.

Sayuri Shirai, 16 October 2018

The Bank of Japan has bought massive quantities of Japanese stocks in a bid to increase aggregate demand and inflation, and to encourage Japanese savers to take on more risk. This column surveys the effectiveness of this quantitative easing programme and identifies several key issues, including stock prices not rising in proportion to profits, the overvaluation of some small-cap stocks, and adverse impacts on corporate governance. It argues that before taking any steps toward monetary policy normalisation, the Bank of Japan should introduce flexibility in interpreting the 2% price stability target.

Events

CEPR Policy Research