How do central banks conduct stress tests to assess the resilience of the financial system to contractionary monetary policy?

Aug 10, 2022 ... In this paper we analyse the role of fiscal policy and its debt maturity structure which is producing this "monetary contraction" through its ... The Board is committed to do what is necessary to ensure that inflation in Australia returns to the 2 to 3 per cent target range over time. It is seeking to do ... Expansionary fiscal policy occurs when the Congress acts to cut tax rates or increase government spending, shifting the aggregate demand curve to the right. Oct 10, 2022 ... Inflation and Quantitative Tightening - A theoretical assessment of contractionary monetary policy and real economic activity The first chapter analyzes the asymmetric effects of contractionary and expansionary monetary policy shocks on income inequality. Using the Consumer ... policy on output is answered clearly: contractionary monetary policy leads to contractions in real GDP. H. Uhlig / Journal of Monetary Economics 52 (2005) 381– ... At the same time, the unemployment rate is very low. In this case, the Fed might decide to use contractionary monetary policy to bring inflation back to the ... Jan 23, 2014 ... Central Bank of Solomon Islands maintains tight monetary policy in face of excess liquidity; IMF welcomes stance but tells authorities to ... contractionary monetary policy exerts an important reallocation effect by cleansing unproductive firms and enhancing aggregate productivity. At the same ... Following an unexpected contractionary monetary policy shock, (constrained) expanding sectors respond primarily by lowering prices, while (unconstrained) ...