Can Monetary Policy Really be Used to Stabilise Asset Prices?

Publication: Policy Letter No. 1, 2008
Topic Area: Macro and Finance
Authors: Stefan Gerlach
Date: Mar 2008
Keywords: monetary policy, asset prices

Many observers have argued that central banks should use monetary policy to prevent the rise of asset price bubbles. Recent research shows that monetary policy is too costly and too slow to serve such a role.

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