The Effective Lower Bound for the Policy Rate in Euroized Economies-An Application to the Case of Albania /

Based on the experience of the Bank of Albania, the paper proposes a framework to estimate the interest rate lower bound in small, open, and euroized economies. The paper introduces a stylized monitoring tool to assess the unintended consequences of low policy rates. The paper is the first attempt t...

وصف كامل

التفاصيل البيبلوغرافية
المؤلف الرئيسي: della Valle, Guido
مؤلفون آخرون: Cabezon, Ezequiel, Themeli, Erald, Veyrune, Romain
التنسيق: دورية
اللغة:English
منشور في: Washington, D.C. : International Monetary Fund, 2018.
سلاسل:IMF Working Papers; Working Paper ; No. 2018/055
الوصول للمادة أونلاين:Full text available on IMF
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100 1 |a della Valle, Guido. 
245 1 4 |a The Effective Lower Bound for the Policy Rate in Euroized Economies-An Application to the Case of Albania /  |c Guido della Valle, Erald Themeli, Romain Veyrune, Ezequiel Cabezon. 
264 1 |a Washington, D.C. :  |b International Monetary Fund,  |c 2018. 
300 |a 1 online resource (28 pages) 
490 1 |a IMF Working Papers 
500 |a <strong>Off-Campus Access:</strong> No User ID or Password Required 
500 |a <strong>On-Campus Access:</strong> No User ID or Password Required 
506 |a Electronic access restricted to authorized BRAC University faculty, staff and students 
520 3 |a Based on the experience of the Bank of Albania, the paper proposes a framework to estimate the interest rate lower bound in small, open, and euroized economies. The paper introduces a stylized monitoring tool to assess the unintended consequences of low policy rates. The paper is the first attempt to estimate the impact of low interest rate on the public's demand for banknote by denomination. A strong preference for banknotes leads economic agents to require a higher remuneration of banks' deposits, lifting the lower bound above zero. Financial euroization also lifts the lower policy bound due to the higher propensity of substituting domestic with foreign currency-denominated assets as a function of the interest rate differential. Policies aiming at reducing financial euroization contribute to bring down the lower bound. 
538 |a Mode of access: Internet 
700 1 |a Cabezon, Ezequiel. 
700 1 |a Themeli, Erald. 
700 1 |a Veyrune, Romain. 
830 0 |a IMF Working Papers; Working Paper ;  |v No. 2018/055 
856 4 0 |z Full text available on IMF  |u http://elibrary.imf.org/view/journals/001/2018/055/001.2018.issue-055-en.xml  |z IMF e-Library