This paper examines how financial fluctuations and macroeconomic stability interact in the case of Venezuela, acknowledging that financial conditions deteriorating the macroeconomic environment can arise with both good and bad macroeconomic performance. An empirical methodology is provided that...

This paper evaluates whether fiscal and foreign exchange policy shocks can explain both credit and credit supply in Venezuela. Empirical evidence suggests that between 65 and 90 percent of credit growth is linked to the buildup of banks' deposits caused by the monetary effects of fiscal...