Abstract—The build-up of financial imbalances in the Baltic States was analyzed in this article. Summarizing the results of the research, it can be stated that the financial imbalances in the Baltic countries loan markets have been build-up simultaneous during the period of 2006-2010, while in real estate markets dwelling prices were over the long-term equilibrium level in 2006 Q4 – 2008 Q4. The research results show that the potential build-up of loan and real estate markets boom in all three Baltic countries could be predicted in 2002-2003 and the specific monetary, fiscal, and macro-prudential policy tools could be introduced in time.
Index Terms—Baltic states, financial imbalances, loan market, macro-prudential policy, real estate market.
V. Deltuvaitė is with the Kaunas University of Technology, Economics and Management Faculty, Finance Department, K. Donelaičio str. 73, LT-44029 Kaunas, Lithuania (e-mail: vilma.deltuvaite@ktu.lt).
Cite: Vilma Deltuvaitė, "The Identification of the Build-up of Financial Imbalances from Macro-Prudential Policy Perspective," Journal of Economics, Business and Management vol. 3, no. 6, pp. 605-612, 2015.