The effects of the current crisis, and the policy failures evident in hindsight, coupled with the limited international experience of implementing macroprudential policies suggest that some success is possible and that macroprudential instruments should be explored further. However, implementation should not proceed without due regard for costs and benefits. Macroprudential policy is new and the potential for unintended side-effects is great.
Costs include policy mistakes, policy leakages, a higher price and lower volume of financial intermediation in normal times, and regulation-induced growth in shadow banking (IMF, 2013c). Interactions with monetary, fiscal, competition, microprudential and crisismanagement policies can promote, but may also inhibit, macroprudential objectives.