We present estimates of finance-adjusted output gaps which incorporate the information on the domestic and global credit cycles for a sample of emerging market economies (EMEs). Following recent BIS research, we use a state-space representation of an HP filter augmented with a measure of the...

Emerging markets and developing economies (EMDEs) weathered the 2009 global recession relatively well. However, the impact of the global recession varied across economies. EMDEs with stronger pre-crisis fundamentals - such as large foreign exchange reserves, sound fiscal positions, and low...

In this paper, I study channels through which risk-appetite shocks to global investors, i.e., global financial shocks, are transmitted to emerging market economies(EMEs). I focus on how transmission channels have changed as EMEs have become able to borrow abroad in the form of equity and local...

This chapter outlines policies to help solve the debt overhang and bring about recovery in both groups of countries. The current financial turmoil is confronting emerging market economies with two shocks: a 'sudden stop' of capital inflows resulting from the global deleveraging process, and a...

We analyze cyclical co-movement in credit, house prices, equity prices, and long-term interest rates across 17 advanced economies. Using a time-varying multi-level dynamic factor model and more than 130 years of data, we analyze the dynamics of co-movement at different levels of aggregation and...