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Have FSRs got news for you?
While communication has been recognised as an important aspect of monetary policy for over three decades and received an enormous amount of attention in the academic literature, there has been almost no attention paid to the importance and effects of financial stability communication. In a new working paper we examine financial markets’ reaction to the Financial Stability Report. Since the global financial crisis, over 40 nations have set up financial stability committees with powers to intervene in financial markets by, for example, changing banks’ capital requirements or placing loan-to-value limits on new ... (full story)