Tag Archive: monetary policy

U-Shaped Monetary Policy Increases the Risk of a Banking Crisis

coins stacked on top of one another nearly falling

With year-on-year inflation rates reaching 10% in 2022, central banks in Europe and the United States started raising monetary policy rates to ensure price stability. The failure of Silicon Valley Bank (SVB) on March 10, 2023, however, laid bare the financial stability risks from hiking interest rates after a prolonged period of rate cuts. For…

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