EVIDENCE ON MONETARY POLICY TRANSMISSION DURING TRANQUIL AND TURBULENT PERIODS

  • Chioma Peace Nwosu Central Bank of Nigeria
  • Afees Salisu Centre for Econometric & Allied Research, University of Ibadan
  • Margaret Johnson Hilili Central Bank of Nigeria
  • Izuchukwu Ifeanyi Okafor Central Bank of Nigeria
  • Izuchukwu Oji-Okoro Central Bank of Nigeria
  • Idis Adediran Centre for Econometric & Allied Research, University of Ibadan
Keywords: Monetary Policy Transmission, SVAR-X Model, MINT, GFC

Abstract

This paper evaluates monetary policy transmission in both tranquil and turbulentperiods for Mexico, Indonesia, Nigeria, and Turkey. Using a structural vectorautoregressive model, we find that the effect of structural shocks from supply, demand,and financial sources tend to fizzle out faster for Nigeria and Mexico compared toIndonesia and Turkey. Another important finding is that while monetary authoritiesin Indonesia and Turkey are more responsive to inflation those in Mexico and Nigeriaare more influenced by the exchange rate. We also observe differences in the conductof monetary policy between the tranquil and turbulent periods.

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Published
2019-10-15
Section
Articles

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