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Monetary policy and credit card spending

Author

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  • Francesco Grigoli
  • Damiano Sandri

Abstract

We analyze the impact of monetary policy on consumer spending using confidential credit card data. Being available at daily frequency, these data improve the identification of the monetary transmission and allow for a more precise characterization of the transmission lags. We find that shocks to short-term interest rates affect spending much more rapidly than shocks to medium-term interest rates. We also document significant asymmetries in the effects of monetary policy. While interest rate hikes strongly curb spending-especially if coupled with reductions in stock prices reflecting pure monetary policy shocks-interest rate cuts appear unable to lift spending. Finally, we exploit the disaggregation of credit card data to examine the heterogeneous effects of monetary policy across spending categories and users' characteristics.

Suggested Citation

  • Francesco Grigoli & Damiano Sandri, 2023. "Monetary policy and credit card spending," BIS Working Papers 1064, Bank for International Settlements.
    • Handle: RePEc:bis:biswps:1064
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    Cited by:

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      • Buda, G & Carvalho, V. M. & Corsetti, G & Duarte, J. B. & Hansen, S. & Moura, A. S. & Ortiz, A. & Rodrigo, T. & Rodríguez Mora, J. V. & Alves da Silva, G., 2026. "The Short Lags of Monetary Policy," Cambridge Working Papers in Economics 2509, Faculty of Economics, University of Cambridge.
      • Afonso S. Moura & Gergely Buda & Vasco M. Carvalho & Giancarlo Corsetti & João B. Duarte & Stephen Hansen & Álvaro Ortiz & Tomasa Rodrigo & José V. Rodríguez Mora & Guilherme Alves da Silva, 2025. "The Short Lags of Monetary Policy," Working Papers w202501, Banco de Portugal, Economics and Research Department.
      • Guilherme Alves da Silva & Gergely Buda & Vasco M. Carvalho & Giancarlo Corsetti & João B. Duarte & Stephen Hansen & Afonso S. Moura & Alberto Ortiz & Tomasa Rodrigo & José V. Rodriguez Mora, 2026. "The Short Lags of Monetary Policy," Working Papers 2631, Federal Reserve Bank of Dallas.
    2. Jonas M. Bruhin & Matthias R. Fengler & Winfried Koeniger & Robert Rohrkemper, 2025. "Consumer spending in Switzerland: insights from a novel transactional data index," Swiss Journal of Economics and Statistics, Springer;Swiss Society of Economics and Statistics, vol. 161(1), pages 1-25, December.
    3. Koeniger Winfried & Kreß Peter & Lehmann Jonas, 2026. "Consumption Expenditures in Austria & Germany: New Evidence based on Transactional Data," German Economic Review, De Gruyter, vol. 27(2), pages 87-131.
    4. Andrejs Zlobins, 2025. "Monetary Policy Transmission in the Euro Area: Is this Time Different? Chapter I: Lags and Strength," Working Papers 2025/01, Latvijas Banka.
    5. repec:cam:camjip:2504 is not listed on IDEAS
    6. Allayioti, Anastasia & Gόrnicka, Lucyna & Holton, Sarah & Martínez Hernández, Catalina, 2024. "Monetary policy pass-through to consumer prices: evidence from granular price data," Working Paper Series 3003, European Central Bank.
    7. Egan, Paul & Kenny, Eoin & O'Toole, Conor, 2023. "Interest rate snapback and the impacts on the Irish economy," Papers WP757, Economic and Social Research Institute (ESRI).
    8. Gergely Buda & Vasco M. Carvalho & Giancarlo Corsetti & João Duarte & Stephen Hansen & Afonso Pereira da Silva & Alvaro Ortiz & Tomasa Rodrigo & Guilherme Alves da Silva & José V. Rodríguez Mora, 2025. "Spain | The Short Lags of Monetary Policy," Working Papers 25/02, BBVA Bank, Economic Research Department.
    9. BBVA Research, 2025. "Spain | The Short Lags of Monetary Policy," Working Papers 25/08, BBVA Bank, Economic Research Department.
    10. Felber, Laura, 2026. "Exchange rates and cross-border consumer spending: Evidence from retail payments data," Journal of International Money and Finance, Elsevier, vol. 162(C).
    11. Corrado, Luisa & Fantozzi, Daniela & Giglioli, Simona, 2026. "Quasi-fiscal policies in times of crisis: A high-frequency data analysis," European Economic Review, Elsevier, vol. 184(C).

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    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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