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Interest rate rules and monetary targeting : what are the links?

Gerberding, Christina; Seitz, Franz; Worms, Andreas - 2009

The paper derives the monetary policy reaction function implied by money growth targeting. It consists of an interest rate response to deviations of the inflation rate from target, to the change in the output gap, to money demand shocks and to the lagged interest rate. We show that this type of...

Persistent link: https://www.econbiz.de/10010206357

Can we identify the Fed's preferences?

Chatelain, Jean-Bernard; Ralf, Kirsten - 2017

Using US data, we estimate optimal policy with a probability below one that the Fed reneges on its commitment ("limited credibility") versus discretionary policy where the Fed reneges on its commitment at all periods with a probability equal to one ("zero credibility"). The transmission...

Persistent link: https://www.econbiz.de/10011695111

The power of helicopter money revisited : a new Keynesian perspective

Carter, Thomas J.; Mendes, Rhys R. - 2020

We analyze money financing of fiscal transfers (helicopter money) in two simple New Keynesian models: a "textbook" model in which all money is non-interest-bearing (e.g., all money is currency), and a more realistic model with interest-bearing reserves. In the textbook model with only...

Persistent link: https://www.econbiz.de/10012159954

Assessing the Effects of a Policy Rate Shock on Market Interest Rates : Interest Rate Pass-Through with a FAVAR Model - The Case of Turkey for the Inflation-Targeting Period

Varlik, Serdar - 2018

The purpose of this paper is to investigate the effectiveness of the central bank's policy rate on market interest rates in Turkey for the inflation-targeting period. Empirical evidence suggests that (i) all interest rates respond to a positive policy rate shock positively for all periods and...

Persistent link: https://www.econbiz.de/10012915255

Has Inflation Targeting Strategy Made A Difference in Ghanaian Macroeconomic Management? Analysis of Business Cycle Fluctuations and Econometric Estimates

Akosah, Nana Kwame; Paul Alagidede, Imhotep; Schaling, Eric - 2020

For over a decade of practicing inflation targeting (IT) strategy, inflation has remained high and persistent while economic growth momentum has boosted in Ghana. This paper investigates the relative macroeconomic benefits of the IT strategy in Ghana based on business cycle fluctuations and...

Persistent link: https://www.econbiz.de/10014093032

Chapter 22. Inflation Targeting

Svensson, Lars E.O. - In: Handbook of monetary economics : volume 3, (pp. 1237-1302). 2010

Inflation targeting is a monetary-policy strategy characterized by an announced numerical inflation target, an implementation of monetary policy that gives a major role to an inflation forecast that has been called forecast targeting, and a high degree of transparency and accountability. It was...

Persistent link: https://www.econbiz.de/10014025620

Gazing at r-star : a hysteresis perspective

Beaudry, Paul; Kartashova, Katya; Meh, Césaire Assah - 2023 - Last updated: January 12, 2023

Many explanations for the decline in real interest rates over the last 30 years point to the role that population aging or rising income inequality plays in increasing the long-run aggregate demand for assets. Notwithstanding the importance of such factors, the starting point of this paper is to...

Persistent link: https://www.econbiz.de/10013482643

Speed limit policies : the output gap and optimal monetary policy

Walsh, Carl E. - 2001

In a standard New Keynesian model, a myopic central bank concerned with stabilizing inflation and changes in the output gap will implement a policy under discretion that replicates the optimal, timeless perspective, precommitment policy. By stabilizing output gap changes, the central bank...

Persistent link: https://www.econbiz.de/10011408406

The optimal degree of monetary-discretion in a New Keynesian model with private information

Waki, Yuichiro; Dennis, Richard J.; Fujiwara, Ippei - In: Theoretical economics : TE ; an open access journal in … 13 (2018) 3, pp. 1319-1368

This paper considers the optimal degree of monetary-discretion when the central bank conducts policy based on its private information about the state of the economy and is unable to commit. Society seeks to maximize social welfare by imposing restrictions on the central bank's actions over time,...

Persistent link: https://www.econbiz.de/10011937351

Central Bank Sentiment and Policy Expectations

Hubert, Paul - 2017

monetary policy. First, we quantify the tone conveyed by FOMC policymakers in their statements using computational linguistics … shocks and investors' sentiment. Third, we estimate the impact of FOMC sentiment on the term structure of private interest … rate expectations using a high-frequency methodology and an ARCH model. Optimistic FOMC sentiment increases policy …

Persistent link: https://www.econbiz.de/10012962696