Researchers from Federal Reserve Board Report Recent Findings in CDC and FDA (Household Excess Savings and the Transmission of Monetary Policy): CDC and FDA

2025 MAY 01 (NewsRx) -- By a News Reporter-Staff News Editor at CDC & FDA Daily -- New research on CDC and FDA is the subject of a report. According to news reporting originating in Washington, District of Columbia, by NewsRx journalists, research stated, “Household savings rose above trend in many developed countries after the onset of COVID-19.”

The news reporters obtained a quote from the research from Federal Reserve Board, “Given its link to aggregate consumption, the presence of these ‘excess savings’ has raised questions about their implications for the transmission of monetary policy. Using a panel of euro-area economies and high-frequency monetary policy shocks, we document that household excess savings dampen the effects of monetary policy on economic activity and inflation, especially during the pandemic period.”

According to the news reporters, the research concluded: “To rationalize our empirical findings, we build a New Keynesian model in which households use savings to self-insure against countercyclical unemployment and consumption risk.”

This research has been peer-reviewed.

For more information on this research see: Household Excess Savings and the Transmission of Monetary Policy. International Journal of Central Banking, 2025;21(2):1-36. International Journal of Central Banking can be contacted at: Assoc International Journal Central Banking, Postfach 16 03 19, Frankfurt, 60066, Germany.

Our news correspondents report that additional information may be obtained by contacting Thiago R. T. Ferreira, Federal Reserve Board, Int Finance Div, Washington, DC 20551, United States. Additional authors for this research include Nils Gornemann and Julio L. Ortiz.

(Our reports deliver fact-based news of research and discoveries from around the world.)