The Transmission of US Monetary Policy Shocks to the Brazilian Economy: A SVAR Analysis with Sign Restrictions

DOI

10.2991/978-94-6463-642-0_39How to use a DOI?

Keywords

Policy transmission; Fiscal policy; Beggar-thy-neighbor; SVAR

Abstract

This paper examines how changes in US monetary policy affect the Brazilian economy. Utilizing a structural vector autoregressive (SVAR) model with sign restrictions, this study identifies transmission mechanisms, focusing on the impact of changes in the US money supply (M2) on Brazil’s GDP, inflation, and money supply. The analysis reveals that US monetary expansion positively influences Brazil’s economic growth and liquidity but also introduces inflationary pressures through trade and capital flows. The results highlight the need for Brazilian policymakers to consider external monetary shocks when formulating domestic policies, given the significant influence of US economic changes on Brazil.

Copyright

© 2025 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Mingjian Yang
PY  - 2025
DA  - 2025/01/24
TI  - The Transmission of US Monetary Policy Shocks to the Brazilian Economy: A SVAR Analysis with Sign Restrictions
BT  - Proceedings of 2024 6th International Conference on Economic Management and Cultural Industry (ICEMCI 2024)
PB  - Atlantis Press
SP  - 368
EP  - 373
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-642-0_39
DO  - 10.2991/978-94-6463-642-0_39
ID  - Yang2025
ER  -