Monetary regimes drive real rates, BIS paper finds
Claudio Borio et al study data going back to 1870 in search of factors pushing down real rates
Research published by the Bank for International Settlements presents new evidence that monetary regimes, rather than factors in the real economy, may be the most important drivers of real interest rates.
Why so low for so long? A long-term view of real interest rates, published on December 19, looks for causal factors behind low real rates in data going back as far as 1870. The long sample helps to show that some factors are only significant for sub-periods, write authors Claudio Borio, Piti
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