experiment of the past decade, stemming from a belief of the government that higher interest rates cause higher inflation … eventually a negative coefficient on inflation in the policy rule. In such an environment, was the exchange rate still a random … walk? Was inflation anchored? Does the "standard model" suffice to explain the broad contours of macroeconomic outcomes in …

monetary policy. We simulate several interest-rate setting policy rules with either high or low inflation targets. We determine … negative spending shocks. For small temporary and large permanent shocks, the output path with zero inflation lies modestly … below that for higher inflation. For large shocks persisting a few quarters, differences in output paths across high- and …

losses for the ECB and try to assess inflation dangers stemming from the 3Y LTROs. In the same section, we also look at the …

impact of the zero bound on the effectiveness of interest rate policy in Japan in terms of stabilizing output and inflation …

permanent shifts of the exchange rate and the price level if a central bank anchors long-run inflation expectations. In line …-run price level target rather than a long-run inflation target avoids these permanent shifts of the exchange rate and the price …