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Inflation expectations, uncertainty and monetary policy

Sims, Christopher A - Bank for International Settlements (BIS) - 2009

Monetary economics as practiced by central bank modelers has made a great deal of progress in recent years. In a 2002 paper I interviewed research economists at four central banks and surveyed the models in use at those banks. I criticized the models for having lost all touch with statistical...

Persistent link: https://www.econbiz.de/10008552000

Relationship and Transaction Lending in a Crisis

Bolton, Patrick; Freixas, Xavier; Gambacorta, Leonardo; … - Bank for International Settlements (BIS) - 2013

relationship banks gather information on their borrowers, which allows them to provide loans for profitable firms during a crisis … firms in a crisis. Using detailed credit register information for Italian banks before and after the Lehman Brothers …' default, we are able to study how relationship and transaction-banks responded to the crisis and we test existing theories of …

Persistent link: https://www.econbiz.de/10010849790

Interventions and inflation expectations in an inflation targeting economy

Pincheira, Pablo - Bank for International Settlements (BIS) - 2013

In this paper we explore the role that exchange rate interventions may play in determining inflation expectations in Chile. To that end, we consider a set of nine deciles of inflation expectations coming from the survey of professional forecasters carried out by the Central Bank of Chile. We...

Persistent link: https://www.econbiz.de/10010849792

Decaying expectations: what inflation forecasts tell us about the anchoring of inflation expectations

Mehrotra, Aaron; Yetman, James - Bank for International Settlements (BIS) - 2014

Well anchored inflation expectations are considered to be a reflection of credible monetary policy. In the past, anchoring has been assessed using either long-run inflation surveys or break-even inflation rates on financial assets with long maturities. But neither of these is ideal. Here we...

Persistent link: https://www.econbiz.de/10010929857

Challenges in macro-finance modeling

Kim, Don H - Bank for International Settlements (BIS) - 2007

This paper discusses various challenges in the specification and implementation of "macro-finance" models in which macroeconomic variables and term structure variables are modeled together in a no-arbitrage framework. I classify macro-finance models into pure latent-factor models ("internal...

Persistent link: https://www.econbiz.de/10005121425

Monetary policy in a downturn: Are financial crises special?

Bech, Morten; Gambacorta, Leonardo - Bank for International Settlements (BIS) - 2012

Accommodative monetary policy during the financial crisis was instrumental in preventing a deeper recession. Views … countries, indicates that monetary policy is less effective in a financial crisis, when impairments in the monetary transmission … the subsequent recovery are more elusive when the downturn is associated with a financial crisis. In addition, we find …

Persistent link: https://www.econbiz.de/10010849783

Inflation Dynamics in the Presence of Informal Labour Markets

Castillo, Paul; Montoro, Carlos - Bank for International Settlements (BIS) - 2012

In this paper we analyse the effects of informal labour markets on the dynamics of inflation and on the transmission of aggregate demand and supply shocks. In doing so, we incorporate the informal sector in a modified New Keynesian model with labour market frictions as in the...

Persistent link: https://www.econbiz.de/10010849785

Is monetary policy overburdened?

Orphanides, Athanasios - Bank for International Settlements (BIS) - 2013

Following the experience of the global financial crisis, central banks have been asked to undertake unprecedented … bank, thereby reducing its effectiveness in maintaining price stability and contributing to crisis management. …

Persistent link: https://www.econbiz.de/10010849791

Interpreting TARGET2 balances

Cecchetti, Stephen; McCauley, Robert; McGuire, Patrick - Bank for International Settlements (BIS) - 2012

The increase in the TARGET2 balance for the Bundesbank has led to a debate in Germany about the appropriate interpretation and policy response, if any. In this paper we review the evidence for the current account financing interpretation, and find it wanting in explaining the data in 2012. BIS...

Persistent link: https://www.econbiz.de/10010849796

Should monetary policy lean against the wind? - an analysis based on a DSGE model with banking

Gambacorta, Leonardo; Signoretti, Federico M - Bank for International Settlements (BIS) - 2013

The global financial crisis has reaffirmed the importance of financial factors for macroeconomic fluctuations. Recent … work has shown how the conventional pre-crisis prescription that monetary policy should pay no attention to financial …

Persistent link: https://www.econbiz.de/10010849802