Hidden Bibliographic Details
| Other authors / contributors: | Hauner, David.
Kumar, Manmohan S.
International Monetary Fund.
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| ISBN: | 1451909063
9781451909067
9781451863727
1451863721
9781451909067
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| Notes: | Available in PDF, ePUB, and Mobi formats on the Internet.
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| Summary: | This paper explores the determinants of long-term government bond yields in the Group of Seven (G-7) economies and analyzes the factors that could explain the conundrum of very low rates in the face of a variety of adverse factors in recent years. In particular, the paper focuses on the deteriorating fiscal position in the G-7 economies and enquires which factors could have offset their impact on long-term interest rates, and how sustainable they are likely to be. A model of interest rate determination is elaborated and estimated for the G-7, with explicit emphasis on capital flows and public savings. The results suggest a high likelihood of a substantial impact of the weaker budgetary positions in the G-7 on global interest rates when the offsetting unprecedented capital flows slow down.
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| Standard no.: | 10.5089/9781451909067.001
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