Has financial globalisation compromised central banks' ability to manage domestic financial conditions? This paper summarises the results from our recent research, which tackles this question from the bond market perspective for both advanced and emerging market economies. Using an asset pricing...

Global risk-off shocks can be highly destabilising for financial markets and, absent an adequate policy response, may trigger severe recessions. In Caballero and Kamber (2019), we document that the unconventional policies adopted by the main central banks were effective in containing asset price...

Chile is no exception to the high co-movement of sovereign long-term rates observed between EMEs and the United States. In particular, we show that the high co-movement is mainly driven by synchronisation of the term premium. The aggressive monetary policy in developed economies since the...

Now there is no part of our economic system which works so badly as our monetary and credit arrangements; none where the results of bad working are so disastrous socially; and none where it is easier to propose a scientific solution. (J. M. Keynes: Speech to the Liberal Party, December 1923, The...

This paper deals with the relationship between exchange rates and monetary policy in small open economies. I also discuss the connection between policy rates in small countries and in major advanced economies. A main point is that central bankers need to know whether the currency is...

The increasing size and concentration of official foreign exchange reserves after years of continued expansion, especially since the Asian crisis, have led to renewed interest in the way reserve management decisions are taken and in their possible impact on financial markets. Reserve management...

We study the cross-border impact of quantitative easing (QE) in the major advanced economies, especially on emerging market economies. We first examine the cross-border financial market impact of central bank announcements of asset purchase programmes. We find marked QE announcement effects on...

A long period of high public debt-to-GDP ratios will alter the interactions between fiscal policy, monetary policy and government debt management. But opinions differ on exactly how. Four perspectives were explored in this workshop: historical analysis of policies in financial crises;...

While the euro area ponders another round of quantitative easing, Poland's monetary policy remains stubbornly conventional. Although the NBP's Monetary Policy Council has delivered a monetary easing cycle, policy rates in Poland remain above those of many peers, most notably the largest trading...