ECB Policies Effective in the Euro Area and Germany

DIW Weekly Report 7 / 2016, S. 83-91

Malte Rieth, Michele Piffer, Michael Hachula

get_appDownload (PDF  335 KB)

get_appGesamtausgabe/ Whole Issue (PDF  0.58 MB)


The European Central Bank has engaged in a wide range of nonstandard monetary policy measures since 2007. Each new tool was accompanied by an intense public debate on its effectiveness. This study evaluates the average effect of these measures on the macro-economy. The estimates show that unexpected changes in monetary policy that lower euro-area sovereign bond yields lead to a significant rise in real GDP, consumer prices, inflation expectations, and credit volume in the euro area. The effects on the German economy are very similar. All in all, the evaluation shows that non-standard monetary policy shocks are effective and contribute to fulfilling the central bank’s mandate.

Malte Rieth

Research Associate in the Macroeconomics Department

Topics: Monetary policy

JEL-Classification: E52;E58;E63
Keywords: Central banks, monetary policy, inflation, structural VAR
Frei zugängliche Version: (econstor)