The Bond between Global Capital Market and Monetary Policy and the Possible Impact of the Covid-19 Pandemic on it

Abstract

Monetary policy is an important part of the country's overall macroeconomic policy. The central banks implement their goals through monetary policy tools. From this perspective, the analysis of the transmission mechanism of the monetary policy, of which the various segments of the capital market are an integral part, is of great importance. Therefore, within the framework of the article, it was considered relevant to study the features of the interaction between the monetary policies of the US Federal Reserve and the European Central Bank and the US, German and French stock market, government and corporate bond markets which are part of the mentioned countries’ capital markets. It is also interesting to study the existing bond specifics before the Covid-19 pandemic and the possible changes caused by the pandemic. The identification and evaluation of the mentioned connection for both pre-pandemic and pandemic periods will help to contribute to the further design of measures aimed at increasing the level of development of the entire capital market and its individual segments through the monetary policy toolkit.