U.S. Monetary Shocks and Global Stock Prices
Luc Laeven () and
Hui Tong ()
No 8090, CEPR Discussion Papers from C.E.P.R. Discussion Papers
This paper studies how U.S. monetary policy affects global stock prices. We find that global stock prices respond strongly to changes in U.S. interest rate policy, with stock prices increasing (decreasing) following unexpected monetary loosening (tightening). This impact is more pronounced for sectors that depend on external financing, and for countries that are more integrated with the global financial market. These findings suggest that financial frictions play an important role in the transmission of monetary policy, and that U.S. monetary policy influences global capital allocation.
Keywords: asset allocation; asset prices; financial constraints; monetary policy; monetary transmission (search for similar items in EconPapers)
JEL-codes: E44 F36 G14 G32 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed
Downloads: (external link)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at firstname.lastname@example.org
Journal Article: US monetary shocks and global stock prices (2012)
Working Paper: U.S. Monetary Shocks and Global Stock Prices (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:8090
Ordering information: This working paper can be ordered from
http://www.cepr.org/ ... ers/dp.php?dpno=8090
Access Statistics for this paper
More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 77 Bastwick Street, London EC1V 3PZ..
Series data maintained by (). This e-mail address is bad, please contact .