02088cas a2200253 a 4500 AALejournalIMF017286 230101c9999 xx r poo 0 0eng d 5.00 USD 9781475560480 1018-5941 BD-DhAAL BD-DhAAL Alter, Adrian. Emerging Market Corporate Leverage and Global Financial Conditions / Adrian Alter, Selim Elekdag. Washington, D.C. : International Monetary Fund, 2016. 1 online resource (49 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Corporate debt in emerging markets has risen significantly in recent years amid accommodative global financial conditions. This paper studies the relationship of leverage growth in emerging market (EM) firms to U.S. monetary conditions, and more broadly, to global financial conditions. We find that accommodative U.S. monetary conditions are reliably associated with faster EM leverage growth during the past decade. Specifically, a 1 percentage point decline in the U.S. policy rate corresponds to an appreciable increase in EM leverage growth of 9 basis points, on average (relative to the sample average leverage growth of 35 basis points per year). This impact is more pronounced for sectors dependent on external financing, for SMEs, and for firms in more financially open EMs with less flexible exchange rates. The findings suggest that global financial conditions affect EM firms' leverage growth in part by influencing domestic interest rates and by relaxing corporate borrowing constraints. Mode of access: Internet Elekdag, Selim. IMF Working Papers; Working Paper ; No. 2016/243 Full text available on IMF http://elibrary.imf.org/view/journals/001/2016/243/001.2016.issue-243-en.xml IMF e-Library