Domestic monetary policy is more dominant than external factors in driving rapid credit growth in Asia, according to an International Monetary Fund paper published on February 7.

Selim Elekdag and Fei Han, the paper's authors, use a multi-country structural vector autoregressive model to uncover the main drivers of credit growth in emerging Asia. The authors note that periods of rapid credit growth often tend to be associated with mounting financial and macroeconomic instability, and that since