How Central Banks Use Macroprudential Tools to Tame Bubbles

Monetary Policy Explained with Fexingo: Central Banks, Money Supply, and Interest Rates · Jul 4, 2026 · 10m · transcript

In Episode 90 of Monetary Policy Explained with Fexingo, Lucas and Luna explore macroprudential policy — the toolkit central banks use to prevent financial bubbles without raising interest rates for everyone. They dive into a real-world case: Sweden's 2010 experience with household debt, where the Riksbank used a loan-to-value cap on mortgages rather than hiking the policy rate. The episode explains how tools like countercyclical capital buffers, debt-to-income limits, and stress tests work, and why central banks now see macroprudential policy as a critical shield for financial…