The paper investigates the monetary transmission mechanism in Ukraine and in particular studies the relative importance of its interest rate channel (IRC). First, we discuss the essential institutional arrangements associated with conduct of monetary policy. Second, we quantify the IRC by means...

Using a semi-structural approach, we jointly estimate time-varying national natural real rates of interest for the four largest economies of the euro area over 1999-2016 and discuss the associated challenges for the single monetary policy. We find evidence of an increased dispersion of real...

The concept of the natural or equilibrium rate of interest has attracted a lot of attention from monetary policymakers in recent years. Most attempts to estimate the natural rate use a closed economy framework. We argue that in the face of greater integration of global product and capital...

We use narrative evidence along with a novel database of real-time data and forecasts from the Bank of Canada's staff economic projections from 1974 to 2015 to construct a new measure of monetary policy shocks and estimate the effects of monetary policy in Canada. We show that it is crucial to...

We estimate the natural rate of interest (r*) using a semi-structural model of the U.S. economy that jointly characterizes the trend and cyclical factors of key macroeconomic variables such as output, the unemployment rate, inflation, and short- and long-term interest rates. We specify a...

Recent treatments of the issue of a zero floor on nominal interest rates have been subject to some important methodological limitations. These include the assumption of perfect foresight or the introduction of the zero lower bound as an initial condition or a constraint on the variance of the...

Inflation Targeting (IT) is a monetary policy in which keeping inflation as close as to the target level using policy tools is the main focus for many central banks. However, purely targeting inflation has the potential to reveal the drawback of the trade-off between inflation and output,...

We develop a two-sector, heterogeneous-agent model with incomplete financial markets to study the distributional effects and aggregate welfare implications of alternative monetary policy rules in emerging market economies. Relative to inflation targeting, exchange rate management benefits...

This paper considers the performance of average inflation targeting (AIT) policy in a New Keynesian model with adaptive learning agents. Our analysis raises concerns regarding robustness of AIT when agents have imperfect knowledge. In particular, the target steady state can be locally unstable...

We tested the LWW rule, namely simplified IFB (Inflation-Forecast-Based) Rule which was put forward by Levin, Wieland and Williams (2001) as applied to China. We found the LWW rule was more robust than the Taylor rule (Taylor, John B, 1993 and 1999). However, the LWW rule does not exhibit...