Mr. Fabian Valencia, International Monetary Fund – Strategy, Policy and Review Department
Mr. Richard Varghese, International Monetary Fund – Strategy, Policy and Review Department
Academics, Government officials from central banks, supervisory bodies, and agencies working on financial stability.
The policy response to the COVID-19 shock included financial regulatory easing across many jurisdictions to facilitate the flow of credit to the real economy and mitigate the amplification of the initial shock. In this session, the authors will present the findings of a study that examines how equity prices reacted to the announcement of these measures in a sample of 18 advanced economies and 8 emerging markets. Using an intraday event study, the authors find that the announcement of looser regulation overall contributed to ease financial conditions in the near term, but its effects varied across sectors and tools. Financial regulatory easing led to lower valuations for financial sector stocks and higher valuations for non-financial sector stocks, particularly for industries that are more dependent on bank financing. Furthermore, equity returns declined following announcements related to easier bank capital regulation and increased after those about liquidity regulation.
To register for this webinar, please complete the online form here by March 2, 2021 (by 12 noon, Singapore time). Only official email addresses are accepted.