E44 - Financial Markets and the Macroeconomy

• Optimal Monetary and Macroprudential Policies

  Staff Working Paper 2021-21 Josef Schroth

  Optimal coordination of monetary and macroprudential policies implies higher risk weights on (safe) bonds any time that banks are required to hold additional capital buffers. Coordination also implies a somewhat tighter monetary-policy stance whenever such capital buffers are released.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Credit and credit aggregates, Financial stability, Financial system regulation and policies, Inflation targets, Monetary policy JEL Code(s): E, E4, E44, E6, E60, G, G2, G21, G28