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Household debt and the macroeconomy

Author

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  • Guy Debelle

Abstract

Lower interest rates and an easing of liquidity constraints have led to a substantial rise in household debt over the past two decades. The greater indebtedness has made the household sector more sensitive to changes in interest rates, income and asset prices. This enhanced sensitivity is higher where more households have variable instead of fixed rate mortgages.

Suggested Citation

  • Guy Debelle, 2004. "Household debt and the macroeconomy," BIS Quarterly Review, Bank for International Settlements, March.
    • Handle: RePEc:bis:bisqtr:0403e
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    References listed on IDEAS

    as
    1. Olivier Jean Blanchard & Lawrence F. Katz, 1992. "Regional Evolutions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 23(1), pages 1-76.
    2. Claudio E. V. Borio, 1995. "The structure of credit to the non-goverment sector and the transmission mechanism of monetary policy: a cross-country comparison," BIS Working Papers 24, Bank for International Settlements.
    3. Sebastian Barnes & Garry Young, 2003. "The rise in US household debt: assessing its causes and sustainability," Bank of England working papers 206, Bank of England.
    4. Alexander Al-Haschimi & Margaret M. McConnell & Richard Peach, 2003. "After the refinancing boom: will consumers scale back their spending?," Current Issues in Economics and Finance, Federal Reserve Bank of New York, vol. 9(Dec).
    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

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