BoE paper examines regulation spillover effects

Case study analyses effect of Spanish balance sheet regulation on Mexico’s economy

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Macro-prudential regulation introduced in Spain in 2012 caused a contraction in household credit in Mexico, a working paper published by the Bank of England has revealed.

In examining whether macro-prudential regulation has cross-border consequences through the presence of global banks, Jagdish Tripathy uses loan-level data to better understand the causal link between a regulatory action and bank behaviour.

According to the BoE economist, the policies were introduced to alleviate uncertainty

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