Gulbrandsen, Magnus Andreas Haare & Natvik, Gisle James (2020)

Monetary Policy and Household Debt

Nordic Economic Policy Review, s. 67- 99. Doi: 10.6027/Nord2020-025

We address the interplay between household debt accumulation and monetary policy. Monetary policy likely affects household debt-to-income ratios via disposable income and inflation, not just by changing the financial incentive to save. We provide micro-level snapshots from Norway on how households’ income flows and debt accumulation co-move with interest rates and inflation. Real interest rate hikes are associated with increased real debt due to strong negative association between inflation and real debt. We therefore caution against pursuing contractionary policies to curb household debt. By lowering inflation, such policies might backfire and increase household debt burdens.

Natvik, Gisle James & Gulbrandsen, Magnus Andreas Haare (2020)

Monetary Policy and Household Debt

[Academic lecture]. NEPR digital launch webinar on Financial Regulation and Macroeconomic Stability in the Nordics, June 2020.

Natvik, Gisle James & Gulbrandsen, Magnus Andreas Haare (2019)

Monetary policy and household debt

[Academic lecture]. Nordic Economic Policy Review 2020: Financial Regulation and Macroeconomic Stability.