Download or read book How Monetary Policy Affects Financial Markets in Switzerland written by Stefan Schwaninger and published by . This book was released on 2012 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The impact of monetary policy changes by the Swiss National Bank (SNB) on financial markets in Switzerland is analysed with an event-study method over the observation period September 2000 to December 2010. I observe the Swiss stock and government bond market indices, the Euro and US Dollar exchange rate to the Swiss franc and option contracts on the Swiss Market Index (SMI). The Euroswiss future is used to determine the surprise element of the interest rate changes. I find that the foreign exchange market shows the most significant reaction to unanticipated monetary policy changes, followed by the bond market. The stock market shows no significant results, but is largely influenced by foreign equity markets. The reaction of options to monetary policy is negligible.
Download or read book The Impact of Foreign Monetary Policy on Financial Variables in Switzerland written by Pascal Meichtry and published by . This book was released on 2016 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper analyses the relationship between changes in foreign monetary policy and Swiss financial markets. Using daily data, we attempt to determine the strengths and differences in the impact of Federal Reserve System and European Central Bank actions on Swiss equity, bond and stock prices. We also investigate the distinct responsiveness of these markets at times where the central bank's decision-making council is meeting. By applying a multiple linear regression approach, we find that the strength of the absolute effect of foreign monetary policy on Swiss financial variables highly depends on the chosen interest rate measure and that the US monetary authority exerts a lower influence than the ECB. In addition, asset prices react in a different way when examining monetary and non-monetary policy shocks separately. Overall, our analysis highlights the importance of financial markets' behaviour for central banks as well as market participants. Moreover, it stresses the reliance of findings on the selected policy measure, central bank or policy event focus.
Download or read book Swiss Monetary History since the Early 19th Century written by Ernst Baltensperger and published by Cambridge University Press. This book was released on 2017-08-03 with total page 267 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book describes the remarkable path which led to the Swiss Franc becoming the strong international currency that it is today. Ernst Baltensperger and Peter Kugler use Swiss monetary history to provide valuable insights into a number of issues concerning the organization and development of monetary institutions and currency that shaped the structure of financial markets and affected the economic course of a country in important ways. They investigate a number of topics, including the functioning of a world without a central bank, the role of competition and monopoly in money and banking, the functioning of monetary unions, monetary policy of small open economies under fixed and flexible exchange rates, the stability of money demand and supply under different monetary regimes, and the monetary and macroeconomic effects of Swiss Banking and Finance. Swiss Monetary History since the Early 19th Century illustrates the value of monetary history for understanding financial markets and macroeconomics today.
Download or read book Switzerland written by International Monetary Fund and published by International Monetary Fund. This book was released on 2011-05-26 with total page 43 pages. Available in PDF, EPUB and Kindle. Book excerpt: The paper assesses the competitiveness of Swiss exporters, and shows that the effect of nominal exchange rate on trade balance depends on the degree of exchange rate pass-through and on trade elasticities. It highlights that the degree of exchange rate pass-through should also be factored in monetary policy decisions. The authorities are considering legislative changes to strengthen macroprudential oversight by supporting the mutual cooperation between Financial Market Supervisory Authority (FINMA) and Swiss National Bank (SNB) over the financial stability. The scope of the too-big-to-fail (TBTF) proposal should also be broadened to address systematic risk.
Download or read book EMU Financial Markets and the World Economy written by Thomas Moser and published by Springer Science & Business Media. This book was released on 2013-04-17 with total page 324 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book is based on the conference "EMU and the Outside World", held at the Swiss Federal Institute of Technology (ETH), December 11, 1998. The conference was organized by the Swiss Institute for Business Cycle Research (KOF), which is supported jointly by the ETH and the Swiss Society for Business Cycle Research (SGK), an organization comprising representatives from private industry, the Swiss National Bank and public authorities. On the eve of the final stage of European Economic and Mone tary Union (EMU), Zurich seemed to be a particularly appropriate place for such a conference. On the one hand, given its location and economic and financial links with the euro area, Switzerland is one of the "outside coun tries" most affected by EMU. On the other hand, it was nowhere else than in Zurich where the vision of "a United States of Europe" was expressed for the first time by Winston Churchill in his speech on September 19, 1946. For many EMU is a step in that direction, whether welcome or not. Most of the papers appearing in this volume were presented at the con ference and have been revised and updated. Three contributions, chapter 11- 13, were commissioned specially for this publication. Besides the authors of the chapters, special thanks are due to Guido Boller, Robert McCauley, Umberto Schwarz, and Charles Wyplosz.
Download or read book Switzerland written by International Monetary Fund. European Dept. and published by International Monetary Fund. This book was released on 2023-06-07 with total page 62 pages. Available in PDF, EPUB and Kindle. Book excerpt: Switzerland: Selected Issues
Download or read book Switzerland written by International Monetary Fund. Monetary and Capital Markets Department and published by International Monetary Fund. This book was released on 2014-09-03 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: This Technical Note on Macroprudential Institutional Arrangements and Policies on Switzerland highlights that macroprudential prudential powers and responsibilities are split across agencies. There is one dedicated macroprudential tool, the Counter Cyclical Buffer, which has a specified framework for decision making and consultation. Developments in real estate and mortgage lending are important systemic concerns. Very loose monetary policy has driven interest rates down to historically low levels, accelerating mortgage lending and bringing total mortgage debt to more than 140 percent of gross domestic product. The authorities have taken measures to address these risks. It is recommended that transparency and accountability could be strengthened by highlighting cross agency activity and policy analysis related to financial stability and macroprudential policies to the public. In a medium-term perspective macroprudential arrangements should be reviewed while considering placing responsibility and powers for macroprudential policies with one institution or committee. Additional measures may be needed. Mortgages to businesses and for commercial purposes deserve further attention and measures.
Download or read book The Federal Reserve System Purposes and Functions written by Board of Governors of the Federal Reserve System and published by . This book was released on 2002 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Provides an in-depth overview of the Federal Reserve System, including information about monetary policy and the economy, the Federal Reserve in the international sphere, supervision and regulation, consumer and community affairs and services offered by Reserve Banks. Contains several appendixes, including a brief explanation of Federal Reserve regulations, a glossary of terms, and a list of additional publications.
Download or read book Possible Effects of European Monetary Union on Switzerland written by Mr.Douglas Laxton and published by International Monetary Fund. This book was released on 1997-03-01 with total page 34 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the possible effects on Switzerland of asset preference shifts in favor of Swiss-franc-denominated assets that could result from EMU. Alternative policy responses to temporary and persistent asset preference shifts and the consequent pressures for exchange rate appreciation are examined. Simulations of a stylized macroeconomic model of the Swiss economy indicate that monetary policy is likely to be the most effective tool for stabilizing output in the short run, but at the cost of a temporary increase in inflationary pressures. The simulations highlight the dilemmas faced by policymakers in an environment with low inflation and nominal interest rates.
Download or read book Negative Interest Rate Policy NIRP written by Andreas Jobst and published by International Monetary Fund. This book was released on 2016-08-10 with total page 48 pages. Available in PDF, EPUB and Kindle. Book excerpt: More than two years ago the European Central Bank (ECB) adopted a negative interest rate policy (NIRP) to achieve its price stability objective. Negative interest rates have so far supported easier financial conditions and contributed to a modest expansion in credit, demonstrating that the zero lower bound is less binding than previously thought. However, interest rate cuts also weigh on bank profitability. Substantial rate cuts may at some point outweigh the benefits from higher asset values and stronger aggregate demand. Further monetary accommodation may need to rely more on credit easing and an expansion of the ECB’s balance sheet rather than substantial additional reductions in the policy rate.
Download or read book Negative Interest Rates and Financial Stability written by Karol Rogowicz and published by Taylor & Francis. This book was released on 2022-12-01 with total page 247 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book sheds new light on a recently introduced monetary tool – negative interest rates policy (NIRP). It provides in-depth insight into this phenomenon, conducted by the central banks in several economies, for example, the Eurozone, Switzerland and Japan, and its possible impact on systemic risk. Although it has been introduced as a temporary policy instrument, it may remain widely used for a longer period and by a greater range of central banks than initially expected, thus the book explores its effects and implications on the banking sector and financial markets, with a particular focus on potentially adverse consequences. There is a strong accent on the uniqueness of negative policy rates in the context of financial stability concerns. The authors assess whether NIRP has any – or in principle a stronger – impact on systemic risk than conventional monetary policy. The book is targeted at presenting and evaluating the initial experiences of NIRP policy during normal, i.e. pre-COVID, times, rather than in periods in which pre-established macroeconomic relations are rapidly disrupted or, specifically, when the source of the disruption is not purely economic in nature, unlike in systemic crisis. The authors adopt both theoretical and practical approaches to explore the key issues and outline the policy implications for both monetary and macroprudential authorities, with respect to negative interest rate policy, thus the book will provide a useful guide for policymakers, academics, advanced students and researchers of financial economics and international finance.
Download or read book Financial and Macroeconomic Connectedness written by Francis X. Diebold and published by Oxford University Press. This book was released on 2015-02-03 with total page 285 pages. Available in PDF, EPUB and Kindle. Book excerpt: Connections among different assets, asset classes, portfolios, and the stocks of individual institutions are critical in examining financial markets. Interest in financial markets implies interest in underlying macroeconomic fundamentals. In Financial and Macroeconomic Connectedness, Frank Diebold and Kamil Yilmaz propose a simple framework for defining, measuring, and monitoring connectedness, which is central to finance and macroeconomics. These measures of connectedness are theoretically rigorous yet empirically relevant. The approach to connectedness proposed by the authors is intimately related to the familiar econometric notion of variance decomposition. The full set of variance decompositions from vector auto-regressions produces the core of the 'connectedness table.' The connectedness table makes clear how one can begin with the most disaggregated pair-wise directional connectedness measures and aggregate them in various ways to obtain total connectedness measures. The authors also show that variance decompositions define weighted, directed networks, so that these proposed connectedness measures are intimately related to key measures of connectedness used in the network literature. After describing their methods in the first part of the book, the authors proceed to characterize daily return and volatility connectedness across major asset (stock, bond, foreign exchange and commodity) markets as well as the financial institutions within the U.S. and across countries since late 1990s. These specific measures of volatility connectedness show that stock markets played a critical role in spreading the volatility shocks from the U.S. to other countries. Furthermore, while the return connectedness across stock markets increased gradually over time the volatility connectedness measures were subject to significant jumps during major crisis events. This book examines not only financial connectedness, but also real fundamental connectedness. In particular, the authors show that global business cycle connectedness is economically significant and time-varying, that the U.S. has disproportionately high connectedness to others, and that pairwise country connectedness is inversely related to bilateral trade surpluses.
Download or read book International Capital Flows written by Martin Feldstein and published by University of Chicago Press. This book was released on 2007-12-01 with total page 500 pages. Available in PDF, EPUB and Kindle. Book excerpt: Recent changes in technology, along with the opening up of many regions previously closed to investment, have led to explosive growth in the international movement of capital. Flows from foreign direct investment and debt and equity financing can bring countries substantial gains by augmenting local savings and by improving technology and incentives. Investing companies acquire market access, lower cost inputs, and opportunities for profitable introductions of production methods in the countries where they invest. But, as was underscored recently by the economic and financial crises in several Asian countries, capital flows can also bring risks. Although there is no simple explanation of the currency crisis in Asia, it is clear that fixed exchange rates and chronic deficits increased the likelihood of a breakdown. Similarly, during the 1970s, the United States and other industrial countries loaned OPEC surpluses to borrowers in Latin America. But when the U.S. Federal Reserve raised interest rates to control soaring inflation, the result was a widespread debt moratorium in Latin America as many countries throughout the region struggled to pay the high interest on their foreign loans. International Capital Flows contains recent work by eminent scholars and practitioners on the experience of capital flows to Latin America, Asia, and eastern Europe. These papers discuss the role of banks, equity markets, and foreign direct investment in international capital flows, and the risks that investors and others face with these transactions. By focusing on capital flows' productivity and determinants, and the policy issues they raise, this collection is a valuable resource for economists, policymakers, and financial market participants.
Download or read book A Changing Financial Environment and the Implications for Monetary Policy written by Paul Mylonas and published by . This book was released on 2000 with total page 56 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Asset Prices and Monetary Policy written by John Y. Campbell and published by University of Chicago Press. This book was released on 2008-11-15 with total page 444 pages. Available in PDF, EPUB and Kindle. Book excerpt: Economic growth, low inflation, and financial stability are among the most important goals of policy makers, and central banks such as the Federal Reserve are key institutions for achieving these goals. In Asset Prices and Monetary Policy, leading scholars and practitioners probe the interaction of central banks, asset markets, and the general economy to forge a new understanding of the challenges facing policy makers as they manage an increasingly complex economic system. The contributors examine how central bankers determine their policy prescriptions with reference to the fluctuating housing market, the balance of debt and credit, changing beliefs of investors, the level of commodity prices, and other factors. At a time when the public has never been more involved in stocks, retirement funds, and real estate investment, this insightful book will be useful to all those concerned with the current state of the economy.
Download or read book Swiss Monetary Policy in a Low Interest Rate Environment written by Severin Maegerle and published by . This book was released on 2013 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This master thesis examines the instruments used by the Swiss National Bank during the financial crisis and their effectivity. It is shown that the main concern during the crisis were liquidity and solvency related issues. The LIBOR-OIS spread proofs to be a very useful tool in order to monitor the effects of the central bank actions on these issues, as the spread represents the combined liquidity and credit risk within the money market. By introducing a combined CDS index of the CHF LIBOR panel banks, these two risks can be separated. The thesis reaches the conclusion that the measures taken by the SNB mainly affected the liquidity risk, except for the actions falling into the category of Financial Sector Policy, which tended to influence the credit risk as well. The null-hypotheses that the taken measures were not significant can partly be neglected.
Download or read book Monetary Policy Transmission in Emerging Markets and Developing Economies written by Mr.Luis Brandao-Marques and published by International Monetary Fund. This book was released on 2020-02-21 with total page 54 pages. Available in PDF, EPUB and Kindle. Book excerpt: Central banks in emerging and developing economies (EMDEs) have been modernizing their monetary policy frameworks, often moving toward inflation targeting (IT). However, questions regarding the strength of monetary policy transmission from interest rates to inflation and output have often stalled progress. We conduct a novel empirical analysis using Jordà’s (2005) approach for 40 EMDEs to shed a light on monetary transmission in these countries. We find that interest rate hikes reduce output growth and inflation, once we explicitly account for the behavior of the exchange rate. Having a modern monetary policy framework—adopting IT and independent and transparent central banks—matters more for monetary transmission than financial development.
