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Monetary policy velocity and its financial effects: an empirical analysis for an emerging economy

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  • Ricardo Ramalhete Moreira

    (Federal University of Esp?rito Santo (Brazil))

Abstract

We contribute to the literature of monetary policy evaluation by proposing a concept and a measurement process of monetary policy velocity. Furthermore, we develop a theoretical model explaining how changes in such a velocity index are accompanied by effects in stock prices. Based on the case of Brazil?s economy from February 2003 to December 2016, our empirical findings indicate that the Brazilian Central Bank robustly affected the domestic stock market level by adjusting monetary policy velocity over time, although such effects were performed in asymmetric ways.

Suggested Citation

  • Ricardo Ramalhete Moreira, 2019. "Monetary policy velocity and its financial effects: an empirical analysis for an emerging economy," PSL Quarterly Review, Economia civile, vol. 72(291), pages 279-295.
    • Handle: RePEc:psl:pslqrr:2019:43
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    References listed on IDEAS

    as
    1. Khaled Guesmi & Duc Khuong Nguyen & Frédéric Teulon, 2013. "Further evidence on the determinants of regional stock market integration in Latin America," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 10(3), pages 397-413, December.
    2. Ricardo Ramalhete MOREIRA, 2015. "Reviewing Taylor rules for Brazil: was there a turning-point?," Journal of Economics and Political Economy, KSP Journals, vol. 2(2), pages 276-289, June.
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    Keywords

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    JEL classification:

    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

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