In this paper, we analyse nominal exchange rate and price dynamics after risk shocks with short-term interest rates constrained by the zero lower bound (ZLB). We show with a stylized theoretical model that temporary risk shocks may lead to permanent shifts of the exchange rate and the price...

We analyse nominal exchange rate and price dynamics after risk premium shocks with short-term interest rates constrained by the zero lower bound (ZLB). In a small-open-economy DSGE model, temporary risk premium shocks lead to shifts of the exchange rate and the price level if a central bank...

Nach einem fast ein Viertel Jahrhundert währenden Zinsrückgang hat sich der Zinsabstieg durch die stark expansive Notenbankpolitik nach der Finanz- und Eurokrise weiter beschleunigt. Geld- und Kapitalmarktzinsen haben die Nulllinie erreicht und teilweise unterschritten. Diese historisch...

This paper questions unconventional fiscal policy effects when the monetary policy rate is at the zero lower bound. We provide evidence for the US that the spread between the policy rate and the US-LIBOR, which is more relevant for private sector transactions, increases with government...