Keywords
macroprudential policy, regulatory easing, vehicle financing, reserve requirements, monetary policy
Abstract
This paper evaluates the effects of a macroprudential policy of regulatory easing implemented amidst a contractionary monetary policy in Brazil. The intervention, carried out by the Central Bank in the third quarter of 2014, relaxed reserve requirements on time deposits to stimulate bank credit for vehicle financing. Using a Difference-in-Differences approach with fixed effects by credit modality and month, the analysis is based on monthly disbursement data for consumer loans from 2011 to 2018. Twelve rolling monthly windows are used to capture the dynamic evolution of the policy’s effects. Results based on a synthetic control group indicate statistically significant and economically meaningful positive impacts in the months immediately following the intervention, peaking at BRL 2 billion in December 2014. From January 2015 onward, a gradual decline is observed, though the effects remain positive through the end of the analysis period. The paper concludes that the policy has a temporary offsetting effect on the contractionary monetary tightening effect on vehicle credit. The study contributes to the literature by offering empirical evidence from a concrete episode of sectoral macroprudential easing under unfavourable macroeconomic circumstances, providing insights into the determinants of its effectiveness in emerging markets.
Acknowledgments
We thank the editors and two anonymous referees for their comments, which substantially improved this article.
Funding
The research received no funds.
Declaration of Conflicting Interests
The authors declared no potential conflicts of interest with respect to the research, authorship, and publication of the article.
Declaration about the scope of AI utilization
The authors did not use an AI tool in the preparation of the article
Recommended Citation
Paliari, M. A., & Vasconcelos, M. R. (2026). Macroprudential Easing Measures in the Context of Contractionary Monetary Policy: The Case of Brazil in 2014. Journal of Banking and Financial Economics, 2026(1), 1-20. https://doi.org/10.7172/2353-6845.jbfe.2026.1.1
First Page
1
Last Page
20
Page Count
20
Received Date
07.08.2025
Revised Date
16.12.2025
Accept Date
26.03.2026
Online Available Date
01.04.2026
DOI
10.7172/2353-6845.jbfe.2026.1.1
JEL Code
E58; E44; E63, E61, E52, E51
Publisher
University of Warsaw
