House prices react rapidly to rates shocks – BIS paper
Monetary policy transmission stronger in US property market than previously thought, study argues
House prices in the US respond far more quickly to surprising rates decisions than was previously thought, the latest working paper from the Bank for International Settlements (BIS) argues.
The authors – Denis Gorea, Oleksiy Kryvtsov and Marianna Kudlyak – say this suggests that the property market constitutes a strong transmission channel for monetary policy.
Their paper, which is based on house price data from 2001 to 2019, observes a strong causal relationship between interest rates and
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