The Impact of US Monetary Policy and Other External Shocks on the Hong Kong Economy

2019 ◽  
pp. 239-260
Author(s):  
Hongyi Chen ◽  
Andrew Tsang
Keyword(s):  
Monetary Policy ◽  
Hong Kong ◽  
Financial Stability ◽  
Mainland China ◽  
External Shocks ◽  
Monetary Policies ◽  
Macroprudential Policies ◽  
Loan Quality ◽  
The Impact ◽  
Us Monetary Policy

This chapter uses the factor-augmented vector autoregression framework to study the impact on the Hong Kong economy of the diverging monetary policies by the Fed, the European Central Bank (ECB), and the Bank of Japan (BoJ), as well as the slowdown of the Mainland economy. The empirical results show that shocks in US monetary policy rate mainly affect interest rate-sensitive sectors in Hong Kong and that monetary easing from the ECB and the BoJ somewhat offsets the impact of tightening of the Fed. Real variables such as real GDP growth and the unemployment rate are more sensitive to the economic slowdown in Mainland China. However, Hong Kong’s financial stability, particularly with regard to loan quality, banks’ capital and liquidity, is well maintained by macroprudential policies, suggesting that Hong Kong’s financial system is resilient to external shocks.

scholarly journals Respon Return Pasar Modal Indonesia terhadap Kebijakan Moneter Domestik dan Asing

2018 ◽  
Vol 7 (1) ◽  
pp. 1-20
Author(s):  
Aulia Yulianti Wulandari ◽  
Noer Azam Achsani ◽  
Lukytawati Anggraeni
Keyword(s):  
Monetary Policy ◽  
Stock Market ◽  
Spillover Effects ◽  
Jel Classification ◽  
External Shocks ◽  
Monetary Policies ◽  
Market Participants ◽  
Foreign Policies ◽  
Asean Countries ◽  
The Impact

Understanding the impact of external shocks on the stock market return and volatility is crucial for market participants as volatility is synonymous with risk. This paper provides comprehensive evidence on the spillover effects of the change of monetary policies from inside country and foreign origins on Indonesia stock market in the period of the time from November 2, 2012 to May 15, 2017. Used symmetric (IGARCH) and asymmetric (EGARCH and APARCH) GARCH model analysis to evaluate the impact of surprise and anticipated changes of monetary policies from inside country and foreign policies (from another ASEAN countries and leading economies, in this paper are United States, Europe, and United Kingdom). Surprise change of monetary policy is proxied by one day change in 3 months interbank offered rate, while anticipated change of monetary policy is proxied by one day change in target interest rate or policy rate. The result shows that information of the monetary policy news and Indonesia stock return is asymmetric. Indonesia stock market is only affected by foreign monetary policies. Keywords: ASEAN stock market, GARCH, Monetary policy JEL classification: C01, C50, E50

scholarly journals Respon Return Pasar Modal Indonesia terhadap Kebijakan Moneter Domestik dan Asing

2018 ◽  
Vol 7 (1) ◽  
pp. 1-20
Author(s):  
Aulia Yulianti Wulandari ◽  
Noer Azam Achsani ◽  
Lukytawati Anggraeni
Keyword(s):  
Monetary Policy ◽  
Stock Market ◽  
Spillover Effects ◽  
Jel Classification ◽  
External Shocks ◽  
Monetary Policies ◽  
Market Participants ◽  
Foreign Policies ◽  
Asean Countries ◽  
The Impact

Understanding the impact of external shocks on the stock market return and volatility is crucial for market participants as volatility is synonymous with risk. This paper provides comprehensive evidence on the spillover effects of the change of monetary policies from inside country and foreign origins on Indonesia stock market in the period of the time from November 2, 2012 to May 15, 2017. Used symmetric (IGARCH) and asymmetric (EGARCH and APARCH) GARCH model analysis to evaluate the impact of surprise and anticipated changes of monetary policies from inside country and foreign policies (from another ASEAN countries and leading economies, in this paper are United States, Europe, and United Kingdom). Surprise change of monetary policy is proxied by one day change in 3 months interbank offered rate, while anticipated change of monetary policy is proxied by one day change in target interest rate or policy rate. The result shows that information of the monetary policy news and Indonesia stock return is asymmetric. Indonesia stock market is only affected by foreign monetary policies. Keywords: ASEAN stock market, GARCH, Monetary policy JEL classification: C01, C50, E50

scholarly journals Impacts of Monetary Policy on Commercial Banks’ Profits: The Case of Vietnam

2017 ◽  
Vol 13 (8) ◽  
pp. 32
Author(s):  
Thanh Nhan Nguyen ◽  
Ngoc Huong Vu ◽  
Ha Thu Le
Keyword(s):  
Monetary Policy ◽  
Commercial Banks ◽  
Positive Impact ◽  
Monetary Policies ◽  
Significance Level ◽  
Doing Business ◽  
Panel Data Regression ◽  
Banking Market ◽  
Data Regression ◽  
The Impact

This paper mainly concentrates on examining the impact of monetary policy on commercial banks’ profit in Vietnam by using panel data regression. In our study, the data is collected from 20 commercial banks which were doing business in Vietnam’s banking market, ranging from 2007 to 2014 in annually frequency. Monetary base (MB), discount rate (DIS) and required reserve ratio (RRR) are used as proxies for monetary policy. Profit before tax (PROFIT) is used to represent commercial banks’ performance. The results show that there is a positive relationship between banks’ profits and monetary policies. Among those chosen variables representing SBV’s monetary policy, only MB has a significant positive impact on bank’s profit at the significance level of 10%. On this premise, the study recommends that MB should be one of the variables in the center of being concerned in the SBV’s policies regarding the banking performance and stability.

scholarly journals Coordination Effects and Optimal Policy Choices of Macroprudential Policy and Monetary Policy

Complexity ◽  
2020 ◽  
Vol 2020 ◽  
pp. 1-11
Author(s):  
Haifeng Pan ◽  
Dingsheng Zhang
Keyword(s):  
Monetary Policy ◽  
Social Welfare ◽  
Optimal Policy ◽  
Real Estate Market ◽  
Macroprudential Policy ◽  
Monetary Policies ◽  
Policy Rules ◽  
Monetary Policy Rules ◽  
Macroprudential Policies ◽  
Dynamic Stochastic

Considering three monetary policy rules, together with two endogenous macroprudential policies that are credit constraints (loan to value, LTV) for households and counter-cyclical capital (capital requirement ratio, CRR) for bankers, this paper establishes a dynamic stochastic general equilibrium (DSGE) model. Based on the welfare analysis of different combinations of macroprudential rules and monetary policy rules, this paper identifies the optimal policy combinations and analyzes the coordination effects between macroprudential policies and monetary policies. The results show that no matter what kind of monetary policy rules is implemented, the introduction of macroprudential rules has improved the level of total social welfare. In the optimal “two pillars” framework of monetary policies and macroprudential rules, the main objective of monetary policy is to stabilize price inflation, and the macroprudential policy to be implemented is the CRR macroprudential policy. This combination can effectively promote the stability of the real estate market, financial market, and macroeconomy, while maximizing the improvement of total social welfare.

scholarly journals Fiscal-Monetary-Financial Stability Interactions in a Data-Rich Environment

2018 ◽  
Vol 18 (3) ◽  
pp. 195-224 ◽  
Author(s):  
Martin Hodula ◽  
Lukáš Pfeifer
Keyword(s):  
Monetary Policy ◽  
Systemic Risk ◽  
Financial Stability ◽  
House Prices ◽  
Empirical Support ◽  
Financial Sector ◽  
Economic Policies ◽  
Real Economy ◽  
Monetary Policies ◽  
Fiscal And Monetary Policy

Abstract In this paper, we shed some light on the mutual interplay of economic policy and the financial stability objective. We contribute to the intense discussion regarding the influence of fiscal and monetary policy measures on the real economy and the financial sector. We apply a factor-augmented vector autoregression model to Czech macroeconomic data and model the policy interactions in a data-rich environment. Our findings can be summarized in three main points: First, loose economic policies (especially monetary policy) may translate into a more stable financial sector, albeit only in the short term. In the medium term, an expansion-focused mix of monetary and fiscal policy may contribute to systemic risk accumulation, by substantially increasing credit dynamics and house prices. Second, we find that fiscal and monetary policy impact the financial sector in differential magnitudes and time horizons. And third, we confirm that systemic risk materialization might cause significant output losses and deterioration of public finances, trigger deflationary pressures, and increase the debt service ratio. Overall, our findings provide some empirical support for countercyclical fiscal and monetary policies.

The information ethics perception gaps between Chinese and American students

2017 ◽  
Vol 30 (2) ◽  
pp. 473-502 ◽  
Author(s):  
Christina Ling-hsing Chang ◽  
Jim Q. Chen
Keyword(s):  
Hong Kong ◽  
Intellectual Property ◽  
Chinese Culture ◽  
Mainland China ◽  
Information Ethics ◽  
Content Type ◽  
Espoused Theory ◽  
American Students ◽  
The Usa ◽  
The Impact

Purpose The purpose of this paper is to understand the impact of Chinese culture on the information ethics perception gaps between Chinese and American students. Design/methodology/approach Using a qualitative approach, this study utilizes Kohlberg’s Cognitive Moral Development model and an open-ended questionnaire to measure and analyze the gaps among information ethics perceptions of students from Taiwan, Mainland China, Hong Kong, and the USA, and to assess the extent to which the gaps are influenced by Chinese culture. Findings Students’ perceptions of intellectual property, information accuracy, privacy, and accessibility (PAPA) are deeply influenced by national culture. Sub-cultures have significant impact on the perceptions. Political systems, history, and legal environment may also play a role in the differences of PAPA perceptions among the three Chinese societies. The study also revealed that accuracy and intellectual property are the most deficient areas of moral developments in both Chinese and American samples. Research limitations/implications The sample sizes from Hong Kong and the USA were relatively small due to resource and time constraints. In addition, the subjects from Hong Kong and the USA were a little bit older than the subjects from Taiwan and Mainland China due to the fact that universities in HK and USA tend to have more non-traditional students than in universities in Mainland China and Taiwan. Second, the questionnaire is a limited means of studying moral reasoning because the results are likely to reflect espoused theory rather than theory-in-use. Practical implications The educational implication of this study calls for a renewed approach to educate students on the importance of information ethics for the sake of sustained economic development. Originality/value The novelty of this research lies in its interpretation of students’ PAPA perceptions and fresh insights from a Chinese guanxi perspective.

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