Interest rate exposure of Slovenian households

english

2024

1 spletni vir (1 datoteka PDF (29 str.))

Narodna in univerzitetna knjižnica
(Obvezni izvod spletne publikacije)

Using data from the Household Finance and Consumption Survey, this paper exam-ines the exposure of Slovenian households to changes in interest rates. I discuss the composition of assets and liabilities of Slovenian households and quantify their di-rect interest rate exposure by identifying components of their balance sheets that have cash flows directly responsive to changes in interest rates. The HFCS data show that the direct interest rate exposure of Slovenian households is, on average, moderately positive, implying that the net interest income of Slovenian households should increase as interest rates rise. Within the sample of households, there is, however, substantial heterogeneity, and I show that households’ direct interest rate exposure varies systematically with several key household characteristics. Among these, housing status is the single most important determinant of households’ inter-est rate exposure. In comparison with the euro area, Slovenia does not stand out, as the direct interest rate exposure of Slovenian households lies close to the middle of the distribution of countries.

08.10.2024