Croatian paper develops financial conditions index

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A Croatian National Bank working paper, published yesterday, proposes a new index for assessing the financial conditions in Croatia, and explores its implications for the real economy.

The paper – Financial Conditions and Economic Activity, by Mirna Dumičić and Ivo Krznar – analyses the interrelation between domestic and external financial conditions and economic activity.

The authors construct a financial conditions index (FCI) that is calculated as a weighted average of numerous variables

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