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21 Dec 2022
RDP
2022-08
Anthony Brassil
And with credit demand only directly responding to cash rate changes via the resulting change in lending rates, zero pass-through would also mute the effect of cash rate changes on ... λ. parameter in BA-MARTIN) if lending rates remaining constant
https://www.rba.gov.au/publications/rdp/2022/2022-08/appendix-a.html
21 Dec 2022
RDP
2022-08
Anthony Brassil
Figure 8: Cash Rate Pass-through to Banks' Lending Rates. Source: Brassil, Major and Rickards (2022). ... rate. So cash rate reductions remain an effective policy tool during large downturns and at low interest rates.
https://www.rba.gov.au/publications/rdp/2022/2022-08/full.html
21 Dec 2022
RDP
2022-08
Anthony Brassil
Holding lending rates constant following a cash rate reduction would therefore prevent any NIM reduction and would prevent any change to credit demand; if zero pass-through is enough to prevent ... a risk premium increase). If this risk premium increase
https://www.rba.gov.au/publications/rdp/2022/2022-08/introduction.html
21 Dec 2022
RDP
2022-08
Anthony Brassil
Saunders T (2022), ‘Part 2 of 2: How High Could the RBA Take the Cash Rate? ... Available at
https://www.rba.gov.au/publications/rdp/2022/2022-08/references.html
21 Dec 2022
RDP
2022-08
Anthony Brassil
A corollary of this finding is that the extent to which cash rate changes were passed through to lending rates in Australia may have been more muted than what would be ... lending rates, such that policy rate reductions become counterproductive.
https://www.rba.gov.au/publications/rdp/2022/2022-08/non-technical-summary.html
21 Dec 2022
RDP
2022-08
Anthony Brassil
The flip side to this is that the pass-through of cash rate changes to lending rates may have been more muted than what the literature would predict. ... And pass-through would likely remain at similar levels were the cash rate reduced to the small
https://www.rba.gov.au/publications/rdp/2022/2022-08/conclusions-policy-implications-and-future-research.html
21 Dec 2022
RDP
2022-08
Anthony Brassil
in Section 4 is not operational) but that they still have a capital shortfall when the cash rate is reduced further. ... responses more than offset the reductions in r. D,t. that come from cash rate reductions at low interest rates?
https://www.rba.gov.au/publications/rdp/2022/2022-08/investigating-the-reversal-rate-in-australia.html
21 Dec 2022
RDP
2022-08
Anthony Brassil
Figure 8: Cash Rate Pass-through to Banks' Lending Rates. Source: Brassil, Major and Rickards (2022). ... rate. So cash rate reductions remain an effective policy tool during large downturns and at low interest rates.
https://www.rba.gov.au/publications/rdp/2022/2022-08/the-pass-through-of-monetary-policy-at-low-interest-rates.html
21 Dec 2022
RDP
2022-08
Anthony Brassil
Once these rates hit the ELB, any further reductions in the cash rate will not be passed through to these accounts. ... As a result, the lower pass-through of monetary policy to retail deposit rates lowers the net income from holding central bank
https://www.rba.gov.au/publications/rdp/2022/2022-08/the-literature-through-the-lens-of-banks-balance-sheets.html