Credit spread and monetary policy

Yuki Teranishi

doi:10.1016/j.econlet.2011.08.022

Credit spread and monetary policy

Yuki Teranishi

Research output: Contribution to journal › Article › peer-review

5 Citations (Scopus)

Abstract

We show that the spread-adjusted Taylor rule including a response to the credit spread is a theoretically optimal monetary policy under heterogeneous loan contracts. However, the optimal response to the credit spread is ambiguous, given the financial market structure.

Original language	English
Pages (from-to)	26-28
Number of pages	3
Journal	Economics Letters
Volume	114
Issue number	1
DOIs	https://doi.org/10.1016/j.econlet.2011.08.022
Publication status	Published - 2012 Jan
Externally published	Yes

Keywords

Credit spread
Heterogeneous loan contracts
Optimal monetary policy

ASJC Scopus subject areas

Finance
Economics and Econometrics

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10.1016/j.econlet.2011.08.022

Cite this

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Credit spread and monetary policy

Abstract

Keywords

ASJC Scopus subject areas

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