BIS paper identifies spillovers from targeted macro-prudential policies
Spillovers may create effects even in sectors not targeted by the policy
Targeted macro-prudential policies may nevertheless have an impact on other sectors, according to a working paper published today (December 6) by the Bank for International Settlements.
Raphael Auer and Steven Ongena focus on Switzerland, which raised the countercyclical capital buffer specifically for mortgage lending. The country did this during a time when monetary policy was constant, helping to filter out the effects of other policies that might impact lending.
Auer and Ongena find that
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