Excess Liquidity and the Effectiveness of Monetary Policy Evidence from Sub-Saharan Africa

Author/creator Saxegaard, Magnus Author
Format Electronic
Publication InfoWashington : International Monetary Fund
Description26 p.
Supplemental ContentFull text available from Ebook Central - Academic Complete

Summary Annotation This paper examines the pattern of excess liquidity in sub-Saharan Africa and its consequences for the effectiveness of monetary policy. the paper argues that understanding the consequences of excess liquidity requires quantifying the extent to which commercial bank holdings of excess liquidity exceed levels required for precautionary purposes. It proposes a methodology for measuring this quantity and uses it to estimate a nonlinear structural VAR model for the CEMAC region, Nigeria and Uganda. the study suggests that excess liquidity weakens the monetary policy transmission mechanism and thus the ability of monetary authorities to influence demand conditions in the economy.
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Technical detailsMode of access: World Wide Web
Genre/formElectronic books.
ISBN9781451909098
ISBN1451909098 (E-Book) Active Record
Stock number00013468

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