1. bookVolume 10 (2021): Issue 1 (January 2021)
Journal Details
License
Format
Journal
eISSN
2336-9205
First Published
11 Mar 2014
Publication timeframe
3 times per year
Languages
English
Open Access

Macroeconomic determinants of MIR interest rate margin in the euro area

Published Online: 26 Jan 2021
Volume & Issue: Volume 10 (2021) - Issue 1 (January 2021)
Page range: 39 - 53
Journal Details
License
Format
Journal
eISSN
2336-9205
First Published
11 Mar 2014
Publication timeframe
3 times per year
Languages
English
Abstract

This study aims to examine the determinants of the MIR interest rate in the Euro area for the period 2003Q1-2015Q3. By employing Fixed and Random Effects as econometric methodologies, I examine whether the MIR rate is affected by the following macroeconomic factors: unemployment rate, inflation rate, GDP growth, political stability index, and wages as percentage of GDP. All these factors have been found to be significant drivers of the MIR rate and thus, they have to be taken into consideration when designing macro-prudential policies. The findings in this paper provide alternative explanations for the empirical evidence concerning interest rate spreads behaviour.

Keywords

JEL Classification

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