ECB Non-standard Monetary Measures, Collateral Constraints and Potential Risks for Monetary Policy

Andrew Hughes Hallett, Paul Fisher

Publikation: Bog/antologi/afhandling/rapportRapportForskning

Resumé

This paper takes a wide view of nonstandard measures in difficult situations. We explore how, and to what extent, prudential metrics written into the new prudential and surveillance regulations can be used as policy instruments. The paper does not try to reach a judgment on which measures will work best. Instead we explore how these policies work; why they depend on high quality collateral/assets; what happens if policymakers are driven to expand the bounds of “sufficient quality or liquidity”; how new credit risks arise and for whom. Some of these risks are quite subtle, implicit or indirect. But they all reduce the effectiveness of the measures in question (a transmission problem). As a result, they require larger interventions to reach certain target values (a feasibility question, given the side effects). Thus, the new prudential regulation regimes offer several nonstandard policy instruments. But they depend of the availability of high quality and liquid collateral/assets. Poor collateral makes nonstandard measures less effective. Less credit and less cheap credit will be offered due to the increasing credit risks. This document was provided by Policy Department A at the
request of the Economic and Monetary Affairs Committee.
OriginalsprogEngelsk
Udgivelses stedLuxembourg
ForlagPublications Office of the European Union
Antal sider23
ISBN (Trykt)9789284631551
ISBN (Elektronisk)9789284631568
DOI
StatusUdgivet - jul. 2018
NavnMonetary Dialogue

Citer dette

Hallett, A. H., & Fisher, P. (2018). ECB Non-standard Monetary Measures, Collateral Constraints and Potential Risks for Monetary Policy. Luxembourg: Publications Office of the European Union. Monetary Dialogue https://doi.org/10.2861/766786
Hallett, Andrew Hughes ; Fisher, Paul. / ECB Non-standard Monetary Measures, Collateral Constraints and Potential Risks for Monetary Policy. Luxembourg : Publications Office of the European Union, 2018. 23 s. (Monetary Dialogue).
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Hallett, AH & Fisher, P 2018, ECB Non-standard Monetary Measures, Collateral Constraints and Potential Risks for Monetary Policy. Monetary Dialogue, Publications Office of the European Union, Luxembourg. https://doi.org/10.2861/766786

ECB Non-standard Monetary Measures, Collateral Constraints and Potential Risks for Monetary Policy. / Hallett, Andrew Hughes ; Fisher, Paul.

Luxembourg : Publications Office of the European Union, 2018. 23 s. (Monetary Dialogue).

Publikation: Bog/antologi/afhandling/rapportRapportForskning

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Hallett AH, Fisher P. ECB Non-standard Monetary Measures, Collateral Constraints and Potential Risks for Monetary Policy. Luxembourg: Publications Office of the European Union, 2018. 23 s. (Monetary Dialogue). https://doi.org/10.2861/766786