The IMF Working Papers series is designed to make IMF staff research available to a wide audience. Almost 300 Working Papers are released each year, covering a wide range of theoretical and analytical topics, including balance of payments, monetary and fiscal issues, global liquidity, and national and international economic developments.
Given the prospects of asynchronous monetary conditions in the United States and the euro area,
this paper analyzes spillovers among these two economies, as well as the implications of
asynchronicity for spillovers to other advanced economies and emerging markets. Through a
structural vector autoregression analysis, country-specific shocks to economic activity and
monetary conditions since the early 1990s are identified, and are used to draw implications about
spillovers. The empirical findings suggest that real and monetary conditions in the United States
and the euro area have oftentimes been asynchronous. The results also point to significant
spillovers among them, in particular since early 2014-with spillovers from the euro area to the
United States being particularly large. Against the backdrop of asynchronous conditions in these
two economies, spillovers from real and money shocks to emerging markets and non-systemic
advanced economies could be dampened.