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Negative Nominal Interest Rates : Three Ways to Overcome the Zero Lower Bound
Buiter, Willem H. - 2010
symmetry to domain over which the central bank can vary its policy rate. They are: (1) abolishing currency (which would also be …
Persistent link: https://www.econbiz.de/10013152378
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Implementation of Monetary Policy : How Do Central Banks Set Interest Rates?
Friedman, Benjamin M. - 2010
variation in the supply of central bank liabilities. In effect, the announcement effect has displaced the liquidity effect as … bank to lend or absorb reserves in response to differences between the policy interest rate and the corresponding target. A …, but not on the current level per se, then the central bank can alter the market-clearing interest rate with no change in …
Persistent link: https://www.econbiz.de/10013141286
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What Does Monetary Policy Do to Long-Term Interest Rates at the Zero Lower Bound?
Wright, Jonathan H. - 2011
The federal funds rate has been stuck at the zero bound for over two years and the Fed has turned to unconventional monetary policies, such as large scale asset purchases to provide stimulus to the economy. This paper uses a structural VAR with daily data to identify the effects of monetary...
Persistent link: https://www.econbiz.de/10013123639
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Measuring the Macroeconomic Impact of Monetary Policy at the Zero Lower Bound
Wu, Jing Cynthia - 2014
This paper employs an approximation that makes a nonlinear term structure model extremely tractable for analysis of an economy operating near the zero lower bound for interest rates. We show that such a model offers an excellent description of the data compared to the benchmark model and can be...
Persistent link: https://www.econbiz.de/10013054032
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Evaluating Central Banks' Tool Kit : Past, Present, and Future
Sims, Eric R. - 2019
We develop a structural DSGE model to systematically study the principal tools of unconventional monetary policy – quantitative easing (QE), forward guidance, and negative interest rate policy (NIRP) – as well as the interactions between them. To generate the same output response, the...
Persistent link: https://www.econbiz.de/10012867082
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Global Effective Lower Bound and Unconventional Monetary Policy
Wu, Jing Cynthia - 2018
In a standard open-economy New Keynesian model, the effective lower bound causes anomalies: output and terms of trade respond to a supply shock in the opposite direction compared to normal times. We introduce a tractable framework to accommodate for unconventional monetary policy. In our model,...
Persistent link: https://www.econbiz.de/10012916610
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Can a Lender of Last Resort Stabilize Financial Markets? Lessons from the Founding of the Fed
Bernstein, Asaf - 2008
emergency currency during a financial crisis and (2) the Federal Reserve Act of 1913 which established a central bank. We employ …
Persistent link: https://www.econbiz.de/10012769641
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Forward Guidance
Hagedorn, Marcus - 2018
We assess the power of forward guidance—promises about future interest rates—as a monetary tool in a liquidity trap using a quantitative incomplete-markets model. Our results suggest the effects of forward guidance are negligible. A commitment to keep future nominal interest rates low for a...
Persistent link: https://www.econbiz.de/10012921508
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Forward Guidance
Svensson, Lars E. O. - 2014
natural part of normal monetary policy for several central banks, including the Reserve Bank of New Zealand and the Swedish …
Persistent link: https://www.econbiz.de/10013039629
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Monetary Policy with Interest on Reserves
Cochrane, John H. - 2014
I analyze monetary policy with interest on reserves and a large balance sheet. I show that conventional theories do not determine inflation in this regime, so I base the analysis on the fiscal theory of the price level. I find that monetary policy can peg the nominal rate, and determine expected...
Persistent link: https://www.econbiz.de/10013044987