TY  - BOOK
AU  - Grigoli,Francesco
TI  - Interest Rate Pass-Through in the Dominican Republic
T2  - IMF Working Papers
SN  - 1513584391 :
SN  - 1018-5941
PY  - 2015///
CY  - Washington, D.C.
PB  - International Monetary Fund
KW  - Asymmetric
KW  - imf
KW  - Interest Rate
KW  - Pass-Through
KW  - Transmission Mechanism
KW  - Western Hemisphere
KW  - Dominican Republic
N2  - A well-functioning monetary transmission mechanism is critical for monetary policy. As the Dominican Republic recently adopted an inflation targeting regime, it is even more relevant to guarantee that changes in the monetary policy rates are quickly and fully reflected in retail rates, to eventually influence aggregate demand and inflation. This paper estimates the interest rate pass-through of the monetary policy rate to retail rates and explores asymmetries in the adjustment. We find evidence of complete pass-through to retail rates, confirming the effectiveness of the monetary policy transmission mechanism. However, our results also suggest a faster pass-through to lending rates than to deposit rates and asymmetric adjustments of short-term rates, as deposit rates respond faster to policy rate cuts and lending rates respond faster to policy rate hikes. Measures to enhance competition in the financial system could help to achieve a symmetric adjustment of retail rates
UR  - http://elibrary.imf.org/view/IMF001/22983-9781513584393/22983-9781513584393/22983-9781513584393.xml
UR  - http://www.imfbookstore.org/IMFORG/9781513584393
ER  -