The goal of this paper is to provide a better understanding of monetary policy effectiveness in the case of indexed bonds. When public debt management deals with bonds indexed to the interest rate set by the monetary policy, there is no wealth effect and, as a consequence, monetary policy has a...

Previous research has explored the impact of private sector debt service ratios (DSRs), ie debt payments relative to income, on medium-term macroeconomic outcomes. This special feature, based on a study of 18 economies, finds that monetary policy shocks, in turn, have a significant impact on...