Arbeitspapier
Debt and Interest Rates: The U.S. and the Euro Area
We find that real interest rates paid on government debt depend significantly upon current and expected future levels of debt, in Europe as in the US. But this result only emerges when we condition on foreign interest rates, illustrating financial international integration. The previously strong effect of debt on US interest rates has been diluted by the addition of 2004-2006 data to the sample, perhaps reflecting the effect of massive purchases of US securities by foreign central banks. Another finding is that the asymmetry in the effect of US interest rates on European interest rates has not disappeared with the coming of European Economic and Monetary Union in 1999, as one might have thought.
- Language
-
Englisch
- Bibliographic citation
-
Series: Economics Discussion Papers ; No. 2007-11
- Classification
-
Wirtschaft
Interest Rates: Determination, Term Structure, and Effects
Open Economy Macroeconomics
Central Banks and Their Policies
- Subject
-
interest rates
inflation
debt
financial integration
- Event
-
Geistige Schöpfung
- (who)
-
Frankel, Jeffrey
Chinn, Menzie D.
- Event
-
Veröffentlichung
- (who)
-
Kiel Institute for the World Economy (IfW)
- (where)
-
Kiel
- (when)
-
2007
- Handle
- Last update
- 10.03.2025, 11:46 AM CET
Data provider
This object is provided by:
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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Frankel, Jeffrey
- Chinn, Menzie D.
- Kiel Institute for the World Economy (IfW)
Time of origin
- 2007
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