Bank recapitalisation versus firm support: A fiscal criterion for crisis policy
Governments routinely invest in private firms. This column argues that these investments have powerful effects on an economy’s crisis resilience, and that those effects depend
The granular origins of inflation
Textbook monetary economics views inflation as fundamentally driven by aggregate shocks, such as money supply or policy rates. This column presents empirical evidence that inflation
Understanding inflation with textual analysis: How news about commodities improves predictions
Commodity prices have historically been considered leading indicators of inflation, but the relationship has weakened since the mid-1980s, making them less reliable predictors. This column
Investor memory and biased beliefs: Evidence from the field
Financial markets are volatile, and research attributes this to highly variable and often irrational investor beliefs. This column uses a large-scale survey of Chinese retail
The Federal Reserve, the new administration, and the outlook for the economy and monetary policy
The new US administration has made the Federal Reserve’s monetary policymaking more complicated both because of the elevated uncertainty regarding administration policies and because of
Dangling fiscal surveillance: EU fiscal policies in 2024
Effectively suspended since the onset of the Covid pandemic, the EU fiscal rules were set to make a comeback in 2024. At the same time,
Non-bank financial institutions’ reliance on banks for contingent credit under stress and its consequences
In recent years, banks’ credit line exposure to non-bank financial institutions has grown significantly. This column analyses the implications by focusing on a specific type
Monetary policy spillovers in the global economy
Over and over in the history of the international monetary system, national policymakers have pointed to – and voiced concerns about – the effects of
