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Monetary Policy Effectiveness In Stimulating The Cees Credit Recovery

Author

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  • OLTEANU, Dan

    (”Costin C. Kiritescu” National Institute for Economic Research, Romanian Academy)

Abstract

This paper aims to appraise the effectiveness of central bank interest rate and quantitative easing measures in boosting private credit recovery from several CEE countries, after the crisis. We found that the monetary policy endeavors significantly succeeded in reducing the money market tensions following the external financial shock. The short-term interbank interest rate strongly responded to the changes in central bank refinancing rate and commercial bank reserves, in all of the analysed countries. Nevertheless, the subsequent links of the transmission chain did not perform as well. Uncertainty in the money market perpetuated a high term spread, while credit risk kept the lending rate at relative high values. The inability of central banks to further stimulate the credit supply put a question mark over the truly factual control of the decision makers on money creation by commercial banks and, consequently, on national economic activity on the whole.

Suggested Citation

  • OLTEANU, Dan, 2015. "Monetary Policy Effectiveness In Stimulating The Cees Credit Recovery," Studii Financiare (Financial Studies), Centre of Financial and Monetary Research "Victor Slavescu", vol. 19(3), pages 8-24.
  • Handle: RePEc:vls:finstu:v:19:y:2015:i:3:p:8-24
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    monetary transmission; credit supply; Eastern Europe;
    All these keywords.

    JEL classification:

    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers

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