Liquidity and the dynamic pattern of price adjustment: a global view

Arbeitspapier

Global liquidity expansion has been very dynamic since 2001. Contrary to conventional wisdom, high money growth rates have not coincided with a concurrent rise in goods prices. At the same time, however, asset prices have increased sharply, significantly outpacing the subdued development in consumer prices. This paper examines the interactions between money, goods and asset prices at the global level. Using aggregated data for major OECD countries, our VAR results support the view that different price elasticities on asset and goods markets explain the recently observed relative price change between asset classes and consumer goods.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Discussion Paper Series 1 ; No. 2008,25

Classification and Topics

• Classification: Wirtschaft ; Global Outlook ; Monetary Policy ; Price Level; Inflation; Deflation ; International Policy Coordination and Transmission
• Subject: Global liquidity ; inflation control ; monetary policy transmission ; asset prices ; Gesamtwirtschaftliche Liquidität ; Inflation ; Konsumgut ; Vermögen ; Preiselastizität ; Schätzung ; OECD-Staaten

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Belke, Ansgar ; Orth, Walter ; Setzer, Ralph
• Event: Veröffentlichung
• (who): Deutsche Bundesbank
• (where): Frankfurt a. M.
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/27649
• Last update: 10.03.2025, 11:42 AM CET