Unconventional Monetary Policies in Emerging Markets and Frontier Countries

Hélène Poirson
Authors registered in the RePEc Author Service: Chiara Fratto and Brendan Harnoys-Vannier

No 2021/014, IMF Working Papers from International Monetary Fund

Abstract: The COVID-19 crisis induced an unprecedented launch of unconventional monetary policy through asset purchase programs (APPs) by emerging market and developing economies. This paper presents a new dataset of APP announcements and implementation from March until August 2020 for 27 emerging markets and 8 small advanced economies. APPs’ effects on bond yields, exchange rates, equities, and debt spreads are estimated using different methodologies. The results confirm that APPs were successful in significantly reducing bond yields in EMDEs, and these effects were stronger than those of policy rate cuts, suggesting that such UMP could be important tools for EMDEs during financial market stress.

Keywords: Unconventional monetary policy; emerging markets; COVID-19; local currency bond markets.; WP; market dysfunctionalities; app announcement; CB transparency; market functioning; markets query; tackling market dysfunctionality; transparency Index; exchange rates; market mechanism; CB credibility; market participant; CB intervention; CB monetary policy stance; Sovereign bonds; Bond yields; Yield curve; Securities; Bonds; Africa; Global (search for similar items in EconPapers)
Pages: 71
Date: 2021-01-22
New Economics Papers: this item is included in nep-cba, nep-cwa, nep-mac and nep-mon
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Citations: View citations in EconPapers (16)

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