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long-run target for the policy rate; and (ii) the central bank is averse to bond-market volatility. In this setting … when the central bank moves more gradually. The same desire to mitigate bond-market volatility can lead the central bank to …
Persistent link: https://www.econbiz.de/10013224344
long-run target for the policy rate; and (ii) the central bank is averse to bond-market volatility. In this setting … when the central bank moves more gradually. The same desire to mitigate bond-market volatility can lead the central bank to …
Persistent link: https://www.econbiz.de/10012457100
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Using two estimated models for the euro area and the United States, this paper investigates whether the observed difference in the amplitude of the interest rate cycle since 1999 in both areas is due to differences in the estimated monetary policy reaction function, differences in the structure...
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