Unconventional U.S. monetary policy and international financial market stability

James Dean ()
Additional contact information
James Dean: Western Carolina University

Economics Bulletin, 2026, vol. 46, issue 1, 250 - 259

Abstract: From December 2008 to December 2015, the Federal Reserve held interest rates at the zero lower bound. Unable to lower short term rates further, the Fed engaged in unconventional monetary policy, buying large quantities of US assets and Treasury bonds. This paper examines the international effect of these large scale asset purchases on foreign financial markets. Using a panel VAR estimation on OECD countries, I find shocks to the Fed's unconventional monetary policy increased global stock market volatility by one standard deviation with little influence on the yield curve. I find slightly larger results for Eurozone countries. Overall, these results indicate the Fed's unconventional monetary policies had a significant impact on financial markets throughout the developed world

Keywords: Panel VAR; International Spillovers; Unconventional Monetary Policy (search for similar items in EconPapers)
JEL-codes: E5 F4 (search for similar items in EconPapers)
Date: 2026-03-30
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.accessecon.com/Pubs/EB/2026/Volume46/EB-26-V46-I1-P22.pdf (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:ebl:ecbull:eb-25-00582

Access Statistics for this article

More articles in Economics Bulletin from AccessEcon
Bibliographic data for series maintained by John P. Conley ().