Fergus Cumming

I am a Senior Research Economist at the Bank of England, where I have worked since 2010. I completed my DPhil in Economics at Nuffield College, Oxford and hold a BSc and MSc from the London School of Economics. My research interests include macroeconomics, monetary policy, household finance and central bank design. Since August 2020, I have been on secondment to the Joint Biosecurity Centre.

This website is used to disseminate my work publicly. All views are my own.

Personal email: fergusc@gmail.com

CV: PDF

Links: BoE Site, Repec, Google Scholar

Working Papers

Monetary Policy and Birth Rates: The Effect of Mortgage Rate Pass-Through on Fertility

[Paper] with Lisa Dettling, Dec 2019

We examine whether monetary policy pass-through to mortgage interest rates affects household fertility decisions. Using administrative data on mortgages and births in the UK, our empirical strategy exploits variation in the timing of when families were eligible for a rate adjustment, coupled with the large reductions in the monetary policy rate that occurred during the Great Recession. We estimate that each 1 percentage point drop in the policy rate increased birth rates by 2 percent. In aggregate, this pass-through of accommodative monetary policy to mortgage rates was sufficiently large to outweigh the headwinds of the Great Recession and prevent a “baby bust” in the UK, in contrast to the US. Our results provide new evidence on the nature of monetary policy transmission to households and suggest a new mechanism via which mortgage contract structures can affect both aggregate demand and supply.

Conference and workshop presentations:

  • 2019: Federal Reserve Board, European Central Bank, Bank of England and University of Essex.

Media Coverage:


Mortgage Cash-flows and Employment

[Paper] [Slides] [Older WP version], June 2020

This paper quantifies the impact of the cash-flow channel of monetary policy on employment by combining novel micro datasets with near-universal coverage. When interest rates fall, mortgaged families spend an important share of the extra cash-flow in their local economy, increasing local labor demand. Overall, a reduction in mortgage payments of £1,000 per household leads to a 0.5 percentage point increase in locally non-tradable employment growth over three years, almost entirely driven by the restaurant sector. Employment-growth effects operate through the intensive margin for small establishments, lower death rates for the mid-sized and higher birth rates for the largest outlets.

Conference and workshop presentations:

  • 2019: Bank of England Chief Economists' Workshop

  • 2018 Barcelona GSE Summer Forum; IAAE Montreal; EEA Cologne; DNB, Federal Reserve Board, Bank of England.


The Distribution of Households' Indebtedness and the Transmission of Monetary Policy

[Paper] [Slides] [Older WP] with Paul Hubert, June 2020

We investigate whether the dynamic response of aggregate consumption to monetary policy depends on the distribution of household debt relative to income. Using UK loan-level micro-data, we propose a novel approach to isolate the fraction of households with a limited ability to smooth consumption. By exploiting time and cross-sectional variation, we show that consumption responds more to monetary policy when the share of financially-vulnerable households is large, but find no state-contingency with respect to the overall level of debt-to-income. Our results highlight the role of household heterogeneity and the importance of indirect channels for understanding monetary transmission to consumption behavior.

Conference and workshop presentations:

  • 2019: IAAE Nicosia; EEA Manchester; MMF London; Besançon; Banque de France; OFCE

  • 2020: LSE

Published Policy Papers

Mapping the UK Financial System with Oliver Burrows and Katie Low, Bank of England

Bank of England Quarterly Bulletin, Q2, pages 114-129, 2015 [Paper] [Video]

Assessing the Adequacy of CCPs' Default Resources with Joe Noss, Bank of England

Bank of England Financial Stability Paper No. 26, November 2013 [Paper]

Blog Articles

The Age Evolution of First-Time Buyers with John Lewis, Bank Underground, August 2020

Monetary Policy Transmission: Borrowing Constraints Matter! with Paul Hubert, Bank Underground, May 2020

The Birds, the Bees and the Bank? with Lisa Dettling, Bank Underground, February 2020

How far do people move house? with Alastair Firrell, Bank Underground, October 2019

Fixing ideas - The slowing of interest rate pass-through to mortgagors, Bank Underground, September 2019

Houses are assets not goods: Pt.1 Bulbs and flowers; Pt.2 Taking the theory to UK data with John Lewis, Bank Underground, September 2019

Diffraction through debt: the cash-flow effect of monetary policy, Bank Underground, March 2019

Why the Black Box should become more transparent, Bank Underground, October 2018

How China lost UK GDP in 22 working days, Bank Underground, September 2015

Helicopter money: setting the tale straight, Bank Underground, August 2015