The First Twenty Years of the European Central Bank: Monetary Policy

A Crash Course on the Euro Crisis

“…To understand unconventional monetary policy and reserve satiation seeReis (2016) andReis (2019), and for an application to the policies of the ECB seeHartmann and Smets (2019).…”

The power of text-based indicators in forecasting Italian economic activity

“…It tends to decrease sharply before national elections and to rebound thereafter (es. in 2001, 2006 and 2013) (Hartmann and Smets, 2018;Neri and Siviero, 2019).…”

“…Uncertainty regarding monetary measures was low when the euro was adopted. After that moment it stayed on low levels till the Global Financial crisis, when ECB started to adopt several unconventional measures such as the Fixed Rate Full Allotment Procedure after the Lehman collapse in October 2008 (Hartmann and Smets, 2018) We conduct a pseudo real-time forecasting experiment 21 to asses the ability of TESI and TEPU indices to track the economic activity. The Bayesian model averaging (BMA) described in Bencivelli et al (2017) is employed to nowcast and forecast one step ahead the quarterly growth of both GDP and some of its main components (value added in service sector, VAS, which account for about 70% of the total economic activity in Italy; households consumption, HHC, and gross fixed investments, GFI).…”

Did the Absence of a Central Bank Backstop in the Sovereign Bond Markets Exacerbate Spillovers During the Euro-Area Crisis?

“…One reason was the inadequacy of the single-currency area's banking and fiscal architecture. A second reason concerns the perception that the ECB's monetary-policy responses to the crisis were often viewed in the markets as inadequate and delayed (Hartmann and Smets, 2018). It was not until actions were taken to move in the direction of a banking union and to create a sovereign-debt-resolution mechanism, and the ECB moved its deposit facility rate into negative territory and undertook quantitative easing and other non-standard policies, that the crisis began to abate.…”