EconPapers    
Economics at your fingertips  
 

Modeling the impact of Coronavirus uncertainty on bank system vulnerability and monetary policy conduct

Salha Ben salem and Ines Slama

MPRA Paper from University Library of Munich, Germany

Abstract: The uncertainty of COVID-19 seriously disrupts the world through various macroeconomic and financial channels. For Tunisia, the Pandemic came when the economy was confronting persevering macroeconomic imbalances, regardless of new progress with policy and reform implementation. This context hits the Tunisian economy, especially as it has not yet exited from the negative effect of the 2011 revolution. This paper aims to analyze how the coronavirus uncertainty shock affects the monetary policy's conduct and the banking system's vulnerability in Tunisia. Using the structural VAR model, we find that the adaptation of an easing credit' policy by the bank can attenuate the uncertainty of COVID-19 uncertainty in a short period but it causes negative consequences on the Tunisian economy in a subsequent period. The empirical results show also that uncertainty decreases the ability of the central bank to improve economic activity and control inflation.

Keywords: COVID-19 uncertainty; bank vulnerability; monetary policy conduct; economic implication (search for similar items in EconPapers)
JEL-codes: E4 E6 G1 (search for similar items in EconPapers)
Date: 2021-04
New Economics Papers: this item is included in nep-ara, nep-cba, nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/107391/1/MPRA_paper_107391.pdf original version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:107391

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().

 
Page updated 2025-03-19
Handle: RePEc:pra:mprapa:107391