Mutations Driven by the Global Financial Crisis on the Hierarchy of Monetary Policy Transmission Mechanism Channels in CEE Countries

This paper analyzes the importance of monetary policy transmission mechanism channels in the countries of Central and Eastern Europe (CEE) on the road to euro and their changes after the event of the recent financial crisis. We build out study based on the vector autoregression (VAR) model, with emphasis on the types of strategies used by central banks (CBs) in the region. The main results indicated the prevalence of the exchange rate channel in the monetary policy transmission mechanism in selected states, and for the post turmoil period the following results: a reduction in the role of the three channels subject to analysis (interest rate channel, bank lending channel and real estate price channel) for countries in the region with CBs that target the exchange rate and the maintaining of the exchange rate channel importance, increasing significance of the interest rate channel and a limited role of the bank lending channel and the price of real estate in CEE countries with national monetary authorities that use a strategy of inflation targeting (IT).