How borrowers respond to future changes in the interest rate on their debt matters for the transmission of monetary policy and for household financial stability. Combining bank data, a letter RCT, and a survey, we study this question in the context of the German mortgage market, where since 2022...

Stablecoins are rapidly expanding as money-like assets for payments, trading, settlement, and cross-border transfer. In response, policymakers are moving quickly to develop new regulatory frameworks to safeguard the monetary and financial system. This article develops a forward-looking,...

We calibrate a lifecycle portfolio-choice model of homeowners facing uninsurable income risk to show that tax deductions for mortgage interest payments and voluntary pension contributions have sizable effects on household portfolios and macroprudential risks. The deductions reduce the after-tax...

Donald Trump's re-election and renewed exit from the Paris Agreement marked a deterioration in the US green bond market. Using a difference-in-differences approach, we estimate a 4.4-6.0 percentage point drop in issuance probability and a USD 20-28 million decline in monthly green-issuance...

Donald Trump's re-election and renewed exit from the Paris Agreement marked a deterioration in the US green bond market. Using a difference-in-differences approach, we estimate a 4.4-6.0 percentage point drop in issuance probability and a USD 20-28 million decline in monthly green-issuance...

Stablecoins are rapidly expanding as money-like assets for payments, trading, settlement, and cross-border transfer. In response, policymakers are moving quickly to develop new regulatory frameworks to safeguard the monetary and financial system. This article develops a forward-looking,...

We calibrate a lifecycle portfolio-choice model of homeowners facing uninsurable income risk to show that tax deductions for mortgage interest payments and voluntary pension contributions have sizable effects on household portfolios and macroprudential risks. The deductions reduce the after-tax...

Since the Iran war, fuel prices in Germany have risen sharply. Our analysis shows that diesel prices at gas stations have increased much more than crude oil prices. On average, downstream margins for oil companies rose by 29 euro cents per liter of diesel during the period under review. To...

Since the Iran war, fuel prices in Germany have risen sharply. Our analysis shows that diesel prices at gas stations have increased much more than crude oil prices. On average, downstream margins for oil companies rose by 29 euro cents per liter of diesel during the period under review. To...

The digital euro project will reach an important milestone this year when the preparation phase ends and the governing council of the ECB will decide whether to enter the next phase before the launch phase. This article provides an overview on how a digital euro is intended to work. An...