For almost 10 years, several central banks in advanced economies have cut and maintained their key policy rates below zero. Central banks in Denmark, the euro area, Japan, Sweden, and Switzerland had turned to such policies in response to persistently below-target inflation rates and a very low...

This paper considers the role of country-level opacity (the lack of availability of information) in amplifying shocks emanating from financial centers. We provide a simple model where, in the presence of ambiguity (uncertainty about the probability distribution of returns), prices in emerging...

This paper takes a new approach to assess the costs and benefits of using different policy tools-macroprudential, monetary, foreign exchange interventions, and capital flow management-in response to changes in financial conditions. The approach evaluates net benefits of policies using quadratic...