Publications

Monetary policy

From this page you can access thematically grouped Analytical Articles published in the Economic Bulletin from 1999, ordered by date of dissemination within each year.

All documents are available in PDF format PDF File. Opens in a new window

  • 16/12/2020
    The impact of unconventional monetary policies on perceptions of extreme events at times of crisis (490 KB) Irma Alonso

    The European Central Bank’s and the Federal Reserve’s announcements of unconventional monetary policies have contributed to significantly reducing market perceptions of the probability of extreme macro-financial events. This phenomenon has arisen in periods of intense market strain, such as the global financial crisis and the current COVID-19 crisis. These measures have served to mitigate the materialisation of extremely unfavourable events through the feedback loop between the financial sector and the real economy and to ensure adequate monetary policy transmission.

  • 03/11/2020
    Inflation persistence in the euro area: the role of expectations (326 KB) Pablo Aguilar

    This article analyses agents’ perception of the period of low inflation in recent years, in the context of a model in which these agents form their expectations on the basis of simple forecasting rules. The approach used allows a distinction to be drawn between which portion of the low inflation phenomenon might be due to temporary factors and which might be considered permanent. The results of the analysis for the euro area suggest that agents perceive the inflation rate’s recent departure from the monetary policy objective to be predominantly temporary, although these deviations are marked by a considerable degree of persistence. In comparative terms, the estimated persistence in the case of the euro area of the deviations observed from the inflation target approximately double those in the United States over the 1-and 5-year horizons.

  • 27/10/2020
    October 2020 Bank Lending Survey in Spain (533 KB) Álvaro Menéndez Pujadas and Maristela Mulino

    The latest Bank Lending Survey results show a widespread contraction of credit supply both in Spain and in the euro area in 2020 Q3, which would be linked to increased risk perception. On the demand side, demand from firms fell in both Spain and the euro area following the marked increase recorded between April and June. Conversely, applications for loans to households for house purchase rose both in Spain and in the euro area, while applications for consumer credit and other lending continued to decline in Spain, albeit at a considerably slower pace than in the previous quarter, and increased in the euro area as a whole. Banks consider that monetary policy measures continued to contribute overall to an expansion of credit supply.

  • 13/10/2020
    Developments in the collective investment industry in Spain between 2008 and 2019 (336 KB) Laura Álvarez and Sergio Mayordomo

    This article shows that collective investment undertakings (CIUs) have grown notably in recent years, both in Spain and other European countries. These developments have come in step with greater sector concentration and a rising percentage of assets managed by entities registered abroad. In line with the evidence documented internationally, the investment portfolios of CIUs domiciled in Spain reflect an increase in risk-taking over the last few years, although the weight of lower credit quality fixed-income instruments is very low. There are very close links between the Spanish banking sector and CIUs. First, a very sizeable share of the assets of Spanish CIUs is managed by subsidiaries of Spanish deposit-taking institutions. Second, a very significant proportion of CIUs’ investment portfolios comprises financial assets issued by the banks themselves. Therefore, in-depth analysis of these interconnections is essential to assess the resilience of CIUs and that of the financial sector as a whole.

  • 14/07/2020
    Bank Lending Survey in Spain. June 2020 (413 KB) Álvaro Menéndez Pujadas

    The latest results of the Bank Lending Survey are very much marked by the impact that the COVID 19 pandemic has had on economic activity and, in consequence, on the credit market. Thus, during 2020 Q2, the credit supply to enterprises eased in Spain, highly influenced by the establishment of the government-backed ICO COVID 19 credit line. In the euro area, the credit supply to enterprises presented little change, in contrast to the significant tightening recorded during the previous financial crisis, owing both to the impact of the tax and economic policy measures adopted and to banks’ stronger capital positions. Both in Spain and the euro area, credit standards and terms and conditions for lending to households tightened, largely as a result of the increase in perceived risk and the deterioration of the economic outlook overall. As regards credit demand, loan applications by enterprises rose sharply both in Spain and the euro area, on account of the increase in their liquidity needs primarily to fund working capital. By contrast, households’ demand fell markedly, against a backdrop of growing economic uncertainty.

  • 28/04/2020
    April 2020 Bank Lending Survey in Spain (573 KB) Álvaro Menéndez Pujadas

    According to the Bank Lending Survey, in 2020 Q1 credit supply contracted slightly in both Spain and the euro area, affecting practically all the segments analysed. Demand for loans continued to fall in Spain across the board, although firms’ demand fell at a slower rate than in the prior quarter. In the euro area as a whole, firms’ demand for funds surged, while that of households slowed. Banks expect the COVID-19 pandemic to have a greater impact in 2020 Q2, especially in the case of demand for financing. For instance, they anticipate an upsurge in firms’ demand for loans between April and June, likely driven by their high liquidity needs. Should these expectations materialise, it would be the largest increase in demand recorded in this segment by the survey since it began in 2003. Conversely, amid growing economic uncertainty financial institutions foresee a slump in demand for loans from households. Furthermore, these intermediaries expect to ease credit standards for loans to firms during those months, foreseeably on account of the State guarantee schemes launched in several countries. According to the respondents, the measures adopted by the ECB (expanded asset purchase programme, negative deposit facility rate and TLTRO III) continued to help relax the credit supply terms and conditions and to contribute to a rise in lending volumes.

  • 11/02/2020
    The relationship between inflation rates in advanced economies (305 KB) Luis J. Álvarez, Ana Gómez Loscos and M.ª Dolores Gadea

    This article analyses the link between the changes in and the drivers of inflation in a broad range of advanced economies, with special emphasis on those of the euro area. Inflation rates are seen to be highly synchronised across countries, especially in the euro area economies, reflecting their close economic and financial links and the common monetary policy. Also, the comovement of inflation is found to be a phenomenon that tends to be more visible in the medium and long-term. At the same time, the synchronisation of core inflation, which is based on products with more stable prices, is seen to be limited. The interdependence of headline inflation, by contrast, is significantly higher and has increased considerably in recent years. The drivers of inflation, according to New Keynesian Phillips curve models, such as inflation expectations, the cyclical position and external prices, also help to explain the relationship between inflation rates in advanced economies and especially in those of the euro area.

  • 21/01/2020
    January 2020 Bank lending survey in Spain (547 KB) Álvaro Menéndez Pujadas

    According to the Bank Lending Survey, during 2019 Q4, credit standards tightened slightly for all categories of lending in Spain, whereas this only affected consumer credit and other lending to households in the euro area. In this segment, the general terms and conditions on new lending eased, both in Spain and in the euro area as a whole. Furthermore, in Spain, the terms and conditions on loans to households for house purchase tightened slightly. Demand for all types of credit in Spain decreased, whereas in the euro area as a whole loan applications from enterprises declined and those from households increased. According to the responding banks, regulatory and supervisory actions on capital, leverage and liquidity had a negligible impact on credit supply in Spain in the second half of 2019, whereas they prompted a slight tightening in the euro area. The NPL ratio contributed to a tightening of credit standards (in consumer credit in Spain and in the other two segments in the euro area). Lastly, as for the ECB’s TLTRO III (the third series of targeted longer-term refinancing operations), the banks’ participation in the September operation was limited and increased significantly in the December operation, as they were essentially attracted by the favourable conditions of this funding.

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