Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/251294 
Year of Publication: 
2021
Series/Report no.: 
Working Papers No. 2021-23
Publisher: 
Banco de México, Ciudad de México
Abstract: 
The COVID-19 pandemic not only generated real shocks affecting economic activity severely, but also a broad uncertainty that unleashed an extreme shock to financial markets. In this paper, we focus on the financial dimension of the pandemic from the viewpoint of an emerging market economy. Accordingly, we estimate a financial conditions index for Mexico since 1993 and find that the acute turmoil generated by the pandemic stands among the four largest episodes of financial distress experienced by the country. In addition, we find evidence suggesting that real variables have responded differently to shocks that worsen financial conditions than to shocks that improve them
Subjects: 
COVID-19
financial conditions
emerging-market economy
local projections
JEL: 
C11
C32
E44
G01
Document Type: 
Working Paper
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