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Foreign banks' lending to firms in emerging market economies (EMEs) is large and denominated primarily in U.S. dollars. This creates a direct connection between U.S. monetary policy and EME credit cycles. We estimate that over a typical U.S. monetary easing cycle, EME borrowers face a...
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Cover -- Advance Praise -- Title Page -- Rights Page -- Contents -- Acknowledgments -- Foreword -- Introduction -- Chapter 1 -- Chapter 2 -- Chapter 3 -- Chapter 4 -- Chapter 5 -- Chapter 6 -- Chapter 7 -- Epilogue -- Endnotes -- Further Resources -- Index -- About the Author
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This paper documents that an appreciation of the U.S. dollar is associated with a reduction in the supply of commercial … and industrial loans by U.S. banks. An increase in the broad dollar index by 2.5 points (one standard deviation) reduces U … secondary market where prices fall and liquidity worsens when the dollar appreciates, with stronger effects for riskier loans …
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. Their annual dollar-weighted returns, measured by IRRs, are around 3% lower than a buy-and-hold strategy over the same … dollar assets, which provide them with convenience services …
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