Lower interest rates and an easing of liquidity constraints have led to a substantial rise in household debt over the past two decades. The greater indebtedness has made the household sector more sensitive to changes in interest rates, income and asset prices. This enhanced sensitivity is higher...

The recent financial crisis has highlighted the need to go beyond a purely micro approach to financial regulation and supervision. In recent months, the number of policy speeches, research papers and conferences that discuss a macro perspective on financial regulation has grown considerably. The...