scholarly journals The Impact of US Uncertainty Shocks on Small Open Economies

2016 ◽  
Vol 28 (2) ◽  
pp. 347-368 ◽  
Author(s):  
Pär Stockhammar ◽  
Pär Österholm
Keyword(s):  
Open Economies ◽  
Small Open Economies ◽  
Uncertainty Shocks ◽  
The Impact

Monetary and macroprudential policy under global financial cycle: The experience of small open economies

2021 ◽  
pp. 5-31
Author(s):  
R. R. Akhmetov ◽  
M. E. Mamonov ◽  
V. A. Pankova
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Financial Stability ◽  
Global Financial Crisis ◽  
Open Economies ◽  
Small Open Economies ◽  
Negative Consequences ◽  
Macroprudential Policy ◽  
Financial Cycle ◽  
The Impact

This review examines the impact of the global financial cycle on small open economies and compares the effectiveness of various monetary and macroprudential policies in the presence of global financial cycle. First, we provide a classification of the channels through which the monetary policy of the world financial regulators (US Federal Reserve, ECB), which largely determines the global financial cycle, is transmitted to small open economies: the channel for interest rates differential, the channel for the activities of global financial institutions, and the channel for commodity prices. Second, by analyzing the arguments of supporters and critics of the monetary policy trilemma, we show how the literature comes to the conclusion that inflation targeting policy is still one of the most optimal solutions for achieving the goals of price and macroeconomic stability but fails to ensure financial stability. The latter requires active coordination with macroprudential policy measures. These conclusions are supported by the analysis of case studies of specific countries (Russia, New Zealand, Brazil, Turkey, etc.), which attempted to mitigate negative consequences of the 2007—2009 global financial crisis.

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