event
Brown Bag Lunch
Monday
26
October
BBL

Unconventional monetary policy and household credit

Ying Xu, PhD student in International Economics
, -

Webinar streamed online

The Brown Bag Lunch is a weekly event organized by International Economics.

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As part of the Brown Bag Lunch series, the International Economics Department at the Graduate Institute is pleased to invite you to a public talk given by Ying Xu, PhD student in International Economics.

Unconventional monetary policy and household credit

Abstract: How does the ECB Asset Purchase Programmes (APP) affect household financing behavior? I use household-level granular data from the ECB Household Finance and Consumption Survey (HFCS) to show that the household sector's credit increase is unequal among different income and wealth groups.
Compared with the bottom income quintile, households belonging to the higher income quintiles increased their credit more, both in mortgage debt and consumer credit after the APP. The increase of new house purchases by high-income quintiles contributes to their mortgage increase. While with credit expansions, high-income quintiles have relatively lower LTV (loan-to-value), DTI (debt-to-income), and DSTI (debt service-to-income) ratios compared with the period before the APP. For different net wealth groups, the middle quintile increased their credit most after the APP. And new mortgage refinancings were mainly taken by the lower net wealth quintiles.