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Monetary Transmission in Developing Countries Evidence from India

We examine the strength of monetary transmission in India, using a conventional structural VAR methodology. We find that a tightening of monetary policy is associated with a significant increase in bank lending rates and conventional effects on the exchange rate, though pass-through to lending rates...

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Bibliographic Details
Main Author: Mishra, Prachi
Other Authors: Montiel, Peter, Sengupta, Rajeswari
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2016
Series:IMF Working Papers
Subjects:
Banks
Reverse Repo Rates
Depository Institutions
Exchange Rates
Monetary Policy, Central Banking, And The Supply Of Money And Credit: General
Bank Credit
Banking
Currency
Corporate Finance And Governance
Monetary Economics
Exchange Rate Arrangements
Money And Monetary Policy
Saving And Capital Investment
Banks And Banking
Interest Rates
Economic Development: Financial Markets
Mortgages
Micro Finance Institutions
Foreign Exchange
Central Bank Policy Rate
Interest Rates: Determination, Term Structure, And Effects
Money
Macroeconomic Analyses Of Economic Development
Financial Services
Credit
India
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
Description
Summary:We examine the strength of monetary transmission in India, using a conventional structural VAR methodology. We find that a tightening of monetary policy is associated with a significant increase in bank lending rates and conventional effects on the exchange rate, though pass-through to lending rates is only partial and exchange rate effects are weak. We could find no significant effects on real output or the inflation rate. Though the message for the effectiveness of monetary transmission in India is therefore mixed, our results for India are more favorable than is often found for other developing countries
Physical Description:68 pages
ISBN:9781475523966

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