Report
The limited effectiveness of euro-zone monetary policy
Monetary policy became highly expansionary in the euro zone in early 2015. Since then, it does not seem to have been very effective: The acceleration in credit to the private sector has been muted; The household savings rate has fallen by 0.5 percentage point; I nterest paid by companies has fallen, which explains the rise in their profits, but corporate investment has not benefited from the higher profits; The depreciation of the euro has not increased the euro zone’s export market share; I nterest received by households has fallen more than interest paid by households; The return to fiscal solvency in the euro-zone countries other than Germany thanks to the fall in interest paid on the public debt has not prevented the peripheral countries’ yield spreads from widening in 2018. The overall assessment of this highly expansionary monetary policy is therefore modest.
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Natixis
Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.
Patrick Artus
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