How does contractionary monetary policy affect the banking system?

Our results are as follows. First, we find that firms' bank loan expectations react to monetary policy, with a contractionary shock leading to a downward. Jun 5, 2011 ... As Congress considers policies to foster economic growth, arguments have been made that the traditional expectations of fiscal policy, ... Nov 26, 2013 ... A higher world interest rate stemming from the contractionary U.S. monetary policy shock therefore may dampen the domestic expenditure in the ... contractionary monetary policy exerts an important reallocation effect by cleansing unproductive firms and enhancing aggregate productivity. At the same ... Apr 12, 2023 ... Also known as tight monetary policy, contractionary policy decreases a nation's money supply to curb rampant inflation and keep the economy in ... Aug 31, 2017 ... We find that a contractionary monetary policy shock has a persistent negative impact on the level of commercial bank assets, but increases the assets of shadow ... Oct 5, 2023 ... A contractionary monetary policy shock leads to a significant increase in labor supply: workers reduce the rate at which they quit jobs to non-employment. Aug 27, 2024 ... Contractionary Monetary Policy: A policy used to decrease the money supply and increase interest rates to reduce inflation. Deflationary Gap: A ... This heterogeneity primarily stems from the less favorable labor market responses of minority groups to contractionary monetary policy. These findings emphasize ... The goal of contractionary monetary policy is to decrease the rate of demand for goods and services, not to stop it.