Financial Cycles : Early Warning Indicators of Banking Crises? /

Can the upturns and downturns in financial variables serve as early warning indicators of banking crises? Using data from 59 advanced and emerging economies, we show that financial overheating can be detected in real time. Equity prices and output gap are the best leading indicators in advanced mark...

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Bibliographic Details
Main Author: Chen, Sally
Other Authors: Svirydzenka, Katsiaryna
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2021.
Series:IMF Working Papers; Working Paper ; No. 2021/116
Subjects:
Online Access:Full text available on IMF
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245 1 0 |a Financial Cycles :   |b Early Warning Indicators of Banking Crises? /  |c Sally Chen, Katsiaryna Svirydzenka. 
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300 |a 1 online resource (79 pages) 
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520 3 |a Can the upturns and downturns in financial variables serve as early warning indicators of banking crises? Using data from 59 advanced and emerging economies, we show that financial overheating can be detected in real time. Equity prices and output gap are the best leading indicators in advanced markets; in emerging markets, these are equity and property prices and credit gap. Moreover, aggregating this information flags financial crisis many years before the crisis. Lastly, we find that the length of financial cycles is of medium-term frequency, calling into question the longer frequency widely used in the estimation of countercyclical capital buffers. 
538 |a Mode of access: Internet 
650 7 |a Business Fluctuations  |2 imf 
650 7 |a Cycles  |2 imf 
650 7 |a Foreign Exchange  |2 imf 
650 7 |a Informal Economy  |2 imf 
650 7 |a Underground Econom  |2 imf 
700 1 |a Svirydzenka, Katsiaryna. 
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