Monetary Policy, Foreign Interest Rate impact on Indonesian Bank Credit

Global Knowledge, Local Solutions: Interest Rate and Monetary Policy

Monetary Policy Committees and Interest Rate Smoothing

We extend the New Keynesian Monetary Policy literature relaxing the assumption that the decisions are taken by a single policymaker, considering instead that monetary policy decisions are taken collectively in a committee. We introduce a Monetary Policy Committee (MPC), whose members have different preferences between output and inflation variability and have to vote on the level of the interes...

Optimal versus realized bank credit risk and monetary policy

Standard banking theory suggests that there exists an optimal level of credit risk that yields maximum bank profit. We identify the optimal level of risk-weighted assets that maximizes banks’ returns in the full sample of US banks over the period 1996–2011. We find that this optimal level is cyclical for the average bank, being higher than the realized credit risk in relatively stable periods w...

Interest Rate Rules and the Credit Channel of Monetary Policy Transmission

This paper develops a general equilibrium model with the banking system and the reserves market, where the central bank a¤ects the federal funds rate through open market operations. We show that when the coe¢ cient that measures the response of the federal funds rate to the in‡ation rate falls below a threshold value, which is very small, the economy will have two steady states, where the low-e...

The Impact of Domestic and Foreign Monetary Policy on Iran\'s economy: Global Modeling

One of the striking features of the business cycles is the patterns of co-movement of output, inflation, interest rates, and real equity prices across countries. This paper empirically examines the effects of domestic and foreign monetary policies on Iranchr('39')s macroeconomic variables (including real production, inflation, short-term interest rate, and real exchange rate) using quarterly da...