aggregate. The impulse responses show that a positive shock to foreign liquidity leads for the euro area to a permanent increase …

, with a contractionary shock leading to a downward revision of expectations. Second, we show that firms’ response depends on … the size and the sign of the shock, with only large and contractionary shocks having a significant negative effect on … expectations. Third, we observe that the different components of central bank communication (i.e. the pure monetary policy shock …

theory …

easing (QE). We study how lending responds to each shock using detailed bank, firm, and household data from Portugal, a …

intermediation turns an otherwise diversifiable source of idiosyncratic economic uncertainty, the ‘risk shock’, into a systemic force …