Download or read book Global Liquidity House Prices and the Macroeconomy written by Ambrogio Cesa-Bianchi and published by International Monetary Fund. This book was released on 2015-01-29 with total page 43 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper we first compare house price cycles in advanced and emerging economies using a new quarterly house price data set covering the period 1990-2012. We find that house prices in emerging economies grow faster, are more volatile, less persistent and less synchronized across countries than in advanced economies. We also find that they correlate with capital flows more closely than in advanced economies. We then condition the analysis on an exogenous change to a particular component of capital flows. We find that a global liquidity shock, identified by aggregating bank-to-bank cross border flows and by using the external instrumental variable approach of Stock and Watson (2012) and Mertens and Ravn (2013), has a much stronger impact on house prices and consumption in emerging markets than in advanced economies. In our empirical model, holding house prices or the exchange rate constant in response to this shock tends to dampen its effects on consumption in emerging economies.
Download or read book Global Liquidity House Prices and the Macroeconomy written by Ambrogio Cesa-Bianchi and published by International Monetary Fund. This book was released on 2015-01-29 with total page 43 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper we first compare house price cycles in advanced and emerging economies using a new quarterly house price data set covering the period 1990-2012. We find that house prices in emerging economies grow faster, are more volatile, less persistent and less synchronized across countries than in advanced economies. We also find that they correlate with capital flows more closely than in advanced economies. We then condition the analysis on an exogenous change to a particular component of capital flows. We find that a global liquidity shock, identified by aggregating bank-to-bank cross border flows and by using the external instrumental variable approach of Stock and Watson (2012) and Mertens and Ravn (2013), has a much stronger impact on house prices and consumption in emerging markets than in advanced economies. In our empirical model, holding house prices or the exchange rate constant in response to this shock tends to dampen its effects on consumption in emerging economies.
Download or read book House Prices and the Macroeconomy written by Charles Goodhart and published by Oxford University Press. This book was released on 2007 with total page 247 pages. Available in PDF, EPUB and Kindle. Book excerpt: House price bubbles, and their aftermath, have become a focus of macro-economic policy concern in most developed countries. This book elucidates the two-way relationship between house-price fluctuations and economic fundamentals. Housing has many features which make it distinct from other assets, like equity. Real estate is not only an asset but also a durable consumption good for households, providing shelter and other housing services. As a result, a house is often the largest and most important asset of households and therefore accounts for a major share of household wealth. Similarly a large share of bank assets is tied to housing values. House price fluctuations may, therefore, have a major effect on economic activity and the soundness of the financial system. Following an introductory chapter, the book is structured into three parts. The first demonstrates the importance of house prices as determinants or indicators of inflation and economic activity. The second focuses on the inter-relationships between bank credit extension and housing prices, and how bubbles can lead to financial crises. The third discusses resultant public policy issues, such as whether, and how, to include housing prices in a general inflation index, and how to restrain the housing/bank credit cycle.
Download or read book Global House Price Fluctuations written by Hideaki Hirata and published by . This book was released on 2012 with total page 25 pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine the properties of house price fluctuations across eighteen advanced economies over the past forty years. We ask two specific questions: First, how synchronized are housing cycles across these countries? Second, what are the main shocks driving movements in global house prices? To address these questions, we first estimate the global components in house prices and various macroeconomic and financial variables. We then evaluate the roles played by a variety of global shocks, including shocks to interest rates, monetary policy, productivity, credit, and uncertainty, in explaining house price fluctuations using a wide range of FAVAR models. We find that house prices are synchronized across countries, and the degree of synchronization has increased over time. Global interest rate shocks tend to have a significant negative effect on global house prices whereas global monetary policy shocks per se do not appear to have a sizeable impact. Interestingly, uncertainty shocks seem to be important in explaining fluctuations in global house prices -- National Bureau of Economic Research web site.
Download or read book Global House Price Fluctuations written by Mr.Hideaki Hirata and published by International Monetary Fund. This book was released on 2013-02-06 with total page 47 pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine the properties of house price fluctuations across 18 advanced economies over the past 40 years. We ask two specific questions: First, how synchronized are housing cycles across these countries? Second, what are the main shocks driving movements in global house prices? To address these questions, we first estimate the global components in house prices and various macroeconomic and financial variables. We then evaluate the roles played by a variety of global shocks, including shocks to interest rates, monetary policy, productivity, credit, and uncertainty, in explaining house price fluctuations using a wide range of FAVAR models. We find that house prices are synchronized across countries, and the degree of synchronization has increased over time. Global interest rate shocks tend to have a significant negative effect on global house prices whereas global monetary policy shocks per se do not appear to have a sizeable impact. Interestingly, uncertainty shocks seem to be important in explaining fluctuations in global house prices.
Download or read book House Price Synchronicity Banking Integration and Global Financial Conditions written by Adrian Alter and published by International Monetary Fund. This book was released on 2018-11-28 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine the relationship between house price synchronicity and global financial conditions across 40 countries and about 70 cities over the past three decades. The role played by cross-border banking flows in residential property markets is examined as well. Looser global financial conditions are associated with greater house price synchronicity, even after controlling for bilateral financial integration. Moreover, we find that synchronicity across major cities may differ from that of their respective countries’, perhaps due to the influence of global investors on local house price dynamics. Policy choices such as macroprudential tools and exchange rate flexibility appear to be relevant for mitigating the sensitivity of domestic housing markets to the rest of the world.
Download or read book Can Global Liquidity Forecast Asset Prices written by Mr.Reginald Darius and published by International Monetary Fund. This book was released on 2010-08-01 with total page 25 pages. Available in PDF, EPUB and Kindle. Book excerpt: During the period leading up to the global financial crisis many asset classes registered rapid price increases. This coincided with a significant rise in global liquidity. This paper attempts to determine the extent to which the rise in asset prices was influenced by developments in global liquidity. We confirm that global liquidity had a significant impact on the buildup in house prices; however, the impact on equity prices was limited. In contrast to common perception, we find that the impact of global liquidity declined during the period of the Great Moderation. The paper also examines spillovers from global liquidity to domestic variables and concludes that domestic factors generally played a more significant role in house price appreciation relative to global factors. This contradicts the hypothesis of weakened potency of domestic monetary policy in the presence of increased international liquidity.
Download or read book Fundamental Drivers of House Prices in Advanced Economies written by Ms.Nan Geng and published by International Monetary Fund. This book was released on 2018-07-18 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: House prices in many advanced economies have risen substantially in recent decades. But experience indicates that housing prices can diverge from their long-run equilibrium or sustainable levels, potentially followed by adjustments that impact macroeconomic and financial stability. Therefore there is a need to monitor house prices and assess whether they are sustainable. This paper focuses on fundamentals expected to drive long run trends in house prices, including institutional and structural factors. The scale of potential valuation gaps is gauged on the basis of a cross-country panel analysis of house prices in 20 OECD countries.
Download or read book Understanding Global Liquidity written by Sandra Eickmeier and published by . This book was released on 2013 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Global Housing Cycles written by Ms.Deniz Igan and published by International Monetary Fund. This book was released on 2012-08-01 with total page 56 pages. Available in PDF, EPUB and Kindle. Book excerpt: Housing cycles and their impact on the financial system and the macroeconomy have become the center of attention following the global financial crisis. This paper documents the characteristics of housing cycles in a large set of countries, and examines the determinants of house price movements. Empirical analysis shows that house price dynamics are mostly driven by income and demographics but fluctuations in these fundamentals and credit conditions can create deviations from the implied equilibrium path. We conclude with a discussion of the macroeconomic implications of house price corrections.
Download or read book Macro financial Stability Policy In A Globalised World Lessons From International Experience Selected Papers From The Asian Monetary Policy Forum 2021 Special Edition And Mas bis Conference written by Edward S Robinson and published by World Scientific. This book was released on 2022-12-28 with total page 724 pages. Available in PDF, EPUB and Kindle. Book excerpt: Since at least the Great Financial Crisis, authorities around the world have increasingly relied on macroprudential policy to help secure financial stability and complement monetary policy as an integral element of a broader macro-financial stability framework. In today's interconnected global financial system, policy actions taken by the major advanced economies can have spillovers on the rest of the world through their impact on capital flows and exchange rates, potentially generating vulnerabilities across borders. Conversely, in emerging market economies, macroprudential policy as well as foreign exchange intervention and/or capital flow management policy can help mitigate the corresponding impact. This can in turn generate spillbacks on advanced economies — spillbacks that have become more sizeable as the emerging market economies' heft in the world has grown. Yet little is known about these interactions.The contents of this book are based on a conference held on 26-28 May 2021 and jointly hosted by the Monetary Authority of Singapore (MAS) and the Bank for International Settlements (BIS). It aims to contribute to existing literature on macro-financial policymaking by providing an overall conceptual framework and documenting the latest global trends and country experiences. In particular, it highlights the role of international spillovers and spillbacks, paying particular attention to emerging market economies. This book is essential reading for academics, graduate students and economic professionals. It can also serve as a handbook for policymakers at central banks, regulatory authorities and other government agencies tasked with designing and implementing macroprudential or more generally macro-financial stability policies. The book will also be of interest to researchers at international organisations.
Download or read book Foreign Demand and Local House Prices Evidence from the US written by Mr.Damien Puy and published by International Monetary Fund. This book was released on 2020-02-28 with total page 31 pages. Available in PDF, EPUB and Kindle. Book excerpt: We test whether foreign demand matters for local house prices in the US using an identification strategy based on the existence of “home bias abroad” in international real estate markets. Following an extreme political crisis event abroad, a proxy for a strong and exogenous shift in foreign demand, we show that house prices rise disproportionately more in neighbourhoods with a high concentration of population originating from the crisis country. This effect is strong, persistent, and robust to the exclusion of major cities. We also show that areas that were already expensive in the late 1990s have experienced the strongest foreign demand shocks and the biggest drop in affordability between 2000 and 2017. Our findings suggest a non-trivial causal effect of foreign demand shocks on local house prices over the last 20 years, especially in neighbourhoods that were already rather unaffordable for the median household.
Download or read book Neoliberalism 2 0 Regulating and Financing Globalizing Markets written by L. Nijs and published by Springer. This book was released on 2016-01-26 with total page 317 pages. Available in PDF, EPUB and Kindle. Book excerpt: In today's increasingly globalized environment, many economic fundamentals need to be reconsidered in order to regain stability in the global marketplace. One such consideration is the failing dynamics of the international tax infrastructure. Neoliberalism 2.0 brings a 21st century assessment of the Pigovian taxes, considering a completely new calibration of the international tax systems, inspired by the historically developed Pigovian tax model. The book considers the impact neoliberalism had and will have on regulatory infrastructure, democracy in an era of globalization and reduced legitimation of the national state. The Pigovian model brings home the often forgotten relationship between taxation (as a part of the regulatory sphere), macro-economics, and the political-philosophical context in which law and economics emerge. The model also takes into account the phenomena of globalization and financialization and is tested using the financial sector as an example. This book addresses the many challenges a Pigovian shift would imply for the sovereign and its national economies. Neoliberalism 2.0 demonstrates the ability to design a paradigm-changing alternative to the current tax infrastructure, while taking into account a low economic growth environment of the future, the implications of globalization and the changing relationship between citizens and their state.
Download or read book Bank Credit Extension and Real Economic Activity in South Africa written by Nombulelo Gumata and published by Springer. This book was released on 2017-03-13 with total page 612 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book presents empirical evidence that supports and facilitates a practical, integrated approach to how bank regulatory and selected macro-prudential tools interact with monetary policy to achieve price and financial stability. The empirical results contained in various chapters accompany in-depth historical analysis and counterfactual scenarios that enable proper policy evaluation and the interaction of bank regulatory, macro-prudential and monetary policy tools in South Africa. The presented evidence also identifies financial asset boom and bust episodes and the associated costly output losses. In addition, the authors explore the amplification of credit dynamics by commodity prices and sector credit re-allocation due to capital inflows shocks. The book’s empirical analysis uses a wide range of statistical and econometric approaches on granular data and economic variables to derive policy implications and recommendations. This in-depth quantitative analysis includes determining inverse transmission of global liquidity, as well as the effects of capital flows, lending-rate margins, financial regulatory uncertainty, the National Credit Act, bank capital-adequacy ratios, bank loan loss provisions, loan-to-value ratios and repayment-to-income ratios on the macro-economy.
Download or read book Housing Markets in Europe written by Olivier de Bandt and published by Springer Science & Business Media. This book was released on 2010-10-14 with total page 416 pages. Available in PDF, EPUB and Kindle. Book excerpt: During the recession in the years 2008-2009, the most severe for mature economies in the post-war period, housing markets were often mentioned as having a special responsibility. The objective of this book is to shed light on the cyclical behaviour of the housing markets, its fundamental determinants in terms of supply and demand characteristics, and its relationship with the overall business cycle. The co-movements of house prices across countries are also considered, as well as the channel of transmission of house price changes to the rest of the economy. Particular attention is paid to the effects on private consumption, through possible wealth effects. The book is a compilation of original papers produced by economists and researchers from the four main national central banks in the euro area, also with the participation of leading academics.
Download or read book Managing Elevated Risk written by Iwan J. Azis and published by Springer. This book was released on 2014-12-11 with total page 129 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book discusses the risks and opportunities that arise in Emerging Asia given the context of a new environment in global liquidity and capital flows. It elaborates on the need to ensure financial and overall economic stability in the region through improved financial regulation and other policy measures to minimize the emergent risks. "Managing Elevated Risk: Global Liquidity, Capital Flows, and Macroprudential Policy—An Asian Perspective" also explores the range of policy options that may be deployed to address the impact of global liquidity on domestic financial and socio-economic conditions including income inequality. The book is primarily aimed at policy makers, financial market regulators and supervisory agencies to help them improve national regulatory systems and to promote harmonization of national regulations and practices in line with global standards. Scholars and researchers will also gain important information and knowledge about the overall impacts of changing global liquidity from the book.
Download or read book One Ring to Rule Them All New Evidence on World Cycles written by Eric Monnet and published by International Monetary Fund. This book was released on 2019-09-20 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: We estimate world cycles using a new quarterly dataset of output, credit and asset prices assembled using IMF archives and covering a large set of advanced and emerging economies since 1950. World cycles, both real and financial, exist and are generally driven by US shocks. But their impact is modest for most countries. The global financial cycle is also much weaker when looking at credit rather than asset prices. We also challenge the view that syncronization has increased over time. Although this is true for prices (goods and assets), this not true for quantities (output and credit). The world business and credit cycles were as strong during Bretton Woods (1950–1972) as during the Globalization period (1984-2006). For most countries, the way their output co-moves with the rest of the world has changed little over the last 70 years. We discuss the reasons behind these new findings and their policy implications for small open economies.
