The Performance of Forecast-Based Monetary Policy Rules under Model Uncertainty
... lags. In particular, the Fuhrer-Moore (FM) model exhibits the highest degree of inertia with respect to both aggregate demand and inflation (cf. Fuhrer and Moore (1995)). In the Federal Reserve Board (FRB) model, prices and spending are subject to higher-order adjustment costs; this model also featur ...
... lags. In particular, the Fuhrer-Moore (FM) model exhibits the highest degree of inertia with respect to both aggregate demand and inflation (cf. Fuhrer and Moore (1995)). In the Federal Reserve Board (FRB) model, prices and spending are subject to higher-order adjustment costs; this model also featur ...
Bank of England Inflation Report August 2006
... CPI inflation, assuming that official interest rates move in line with market yields. After the initial near-term rise, the central projection is for inflation to ease back towards the target. With energy and import price inflation moderating, and against a background of robust demand growth and lim ...
... CPI inflation, assuming that official interest rates move in line with market yields. After the initial near-term rise, the central projection is for inflation to ease back towards the target. With energy and import price inflation moderating, and against a background of robust demand growth and lim ...
determinants of universal bank lending rate in ghana
... the depositor but this pool of resources allows for financial, fiscal deficit has resulted in financial tax obligation on universal banks. It develops a situation that can create high inflation and continues high lending rate. The cost of tax on these reserves universal banks hold to protect themsel ...
... the depositor but this pool of resources allows for financial, fiscal deficit has resulted in financial tax obligation on universal banks. It develops a situation that can create high inflation and continues high lending rate. The cost of tax on these reserves universal banks hold to protect themsel ...
Monetary Policy Interim Report
... stagnant productivity, as the negative effects on domestic demand would more than offset the positive effects of external demand. The improvement in cost competitiveness must therefore also be based on productivity gains. The structural reforms directed at the more efficient functioning of product a ...
... stagnant productivity, as the negative effects on domestic demand would more than offset the positive effects of external demand. The improvement in cost competitiveness must therefore also be based on productivity gains. The structural reforms directed at the more efficient functioning of product a ...
The Zero Lower Bound and Endogenous Uncertainty
... rate approaches its ZLB due to the restriction the constraint places on the ability of the central bank to stabilize the economy. In our model, the ZLB arises in states where the discount factor or technology are high (i.e., low demand or high supply). In those states, firms reduce their prices, whi ...
... rate approaches its ZLB due to the restriction the constraint places on the ability of the central bank to stabilize the economy. In our model, the ZLB arises in states where the discount factor or technology are high (i.e., low demand or high supply). In those states, firms reduce their prices, whi ...
del02-stein 221139 en
... several factors10. (a) The short-term approaches rely very heavily upon anticipations, whose explanatory power has proven to be unsatisfactory. (b) The state of macroeconomics, that aims to explain shorter- term movements in the rate of capacity utilization or inflation, is extremely controversial. ...
... several factors10. (a) The short-term approaches rely very heavily upon anticipations, whose explanatory power has proven to be unsatisfactory. (b) The state of macroeconomics, that aims to explain shorter- term movements in the rate of capacity utilization or inflation, is extremely controversial. ...
Unemployed
... and a fall in the number of people unemployed. This means that the number of people in the Labour Force has not changed from Scenario 1. This leads to an overall fall in the unemployment rate. Mathematically, the denominator in the unemployment rate equation has not changed in magnitude but the nume ...
... and a fall in the number of people unemployed. This means that the number of people in the Labour Force has not changed from Scenario 1. This leads to an overall fall in the unemployment rate. Mathematically, the denominator in the unemployment rate equation has not changed in magnitude but the nume ...
Parkin-Bade Chapter 22
... A rise in the price level, other things remaining the same, increases the price of domestic goods relative to foreign goods. So imports increase and exports decrease, which decreases the quantity of real GDP demanded. Similarly, a fall in the price level, other things remaining the same, increases t ...
... A rise in the price level, other things remaining the same, increases the price of domestic goods relative to foreign goods. So imports increase and exports decrease, which decreases the quantity of real GDP demanded. Similarly, a fall in the price level, other things remaining the same, increases t ...
Chapter 6
... other things remaining the same, decreases the real value of money and raises the interest rate. Faced with a higher interest rate, people try to borrow and spend less so the quantity of real GDP demanded decreases. Similarly, a fall in the price level increases the real value of money and lowers th ...
... other things remaining the same, decreases the real value of money and raises the interest rate. Faced with a higher interest rate, people try to borrow and spend less so the quantity of real GDP demanded decreases. Similarly, a fall in the price level increases the real value of money and lowers th ...
Parkin-Bade Chapter 22
... A rise in the price level, other things remaining the same, increases the price of domestic goods relative to foreign goods. So imports increase and exports decrease, which decreases the quantity of real GDP demanded. Similarly, a fall in the price level, other things remaining the same, increases t ...
... A rise in the price level, other things remaining the same, increases the price of domestic goods relative to foreign goods. So imports increase and exports decrease, which decreases the quantity of real GDP demanded. Similarly, a fall in the price level, other things remaining the same, increases t ...
Chapter 9
... 1973–1974 oil price shock (though it did during the 1979–1980 shock) • It could be that people expected the 1973–1974 oil price shock to be permanent • In that case the real interest rate would not necessarily rise • If so, people’s expectations were correct, since the 1973–1974 shock seems to have ...
... 1973–1974 oil price shock (though it did during the 1979–1980 shock) • It could be that people expected the 1973–1974 oil price shock to be permanent • In that case the real interest rate would not necessarily rise • If so, people’s expectations were correct, since the 1973–1974 shock seems to have ...
Informe sobre la Inflación
... The negative impact of the deterioration in the external environment on the Mexican financial markets not only was perceived on the exchange rate evolution, but also on the performance of government securities’ interest rates, which increased for most terms. In view of the monetary policy adjustment ...
... The negative impact of the deterioration in the external environment on the Mexican financial markets not only was perceived on the exchange rate evolution, but also on the performance of government securities’ interest rates, which increased for most terms. In view of the monetary policy adjustment ...
paper - University of Oxford, Department of Economics
... area before 2007, suggests that fiscal rules will be rather different within a monetary union, or with fixed rather than floating exchange rates. The second reason why a fiscal equivalent of a Taylor rule may be elusive also reflects national differences, but in this case differences in political st ...
... area before 2007, suggests that fiscal rules will be rather different within a monetary union, or with fixed rather than floating exchange rates. The second reason why a fiscal equivalent of a Taylor rule may be elusive also reflects national differences, but in this case differences in political st ...
Can global economic conditions explain low New Zealand inflation? AN2015/03
... Monetary policy is always set in an environment of significant uncertainty. At the same time, monetary policy takes 18-24 months to have its full effect on economic activity and inflation. Consequently, the Bank uses economic forecasts to guide policy decisions. It is inevitable, however, that there ...
... Monetary policy is always set in an environment of significant uncertainty. At the same time, monetary policy takes 18-24 months to have its full effect on economic activity and inflation. Consequently, the Bank uses economic forecasts to guide policy decisions. It is inevitable, however, that there ...
Unconventional Fiscal Policy at the Zero Bound
... Eggertsson (2009), where lump-sum taxes are allowed, we show that the first-best allocation can be implemented at the zero bound with unconventional fiscal policy (Section I). The first best can also be attained in a model with capital (Section II) and also in a model with sticky prices and sticky w ...
... Eggertsson (2009), where lump-sum taxes are allowed, we show that the first-best allocation can be implemented at the zero bound with unconventional fiscal policy (Section I). The first best can also be attained in a model with capital (Section II) and also in a model with sticky prices and sticky w ...
Chapter 9
... – The real interest rate did not rise during the 1973–1974 oil price shock (though it did during the 1979–1980 shock) • It could be that people expected the 1973–1974 oil price shock to be permanent • In that case the real interest rate would not necessarily rise • If so, people’s expectations were ...
... – The real interest rate did not rise during the 1973–1974 oil price shock (though it did during the 1979–1980 shock) • It could be that people expected the 1973–1974 oil price shock to be permanent • In that case the real interest rate would not necessarily rise • If so, people’s expectations were ...
CH 9 PDF
... – The real interest rate did not rise during the 1973–1974 oil price shock (though it did during the 1979–1980 shock) • It could be that people expected the 1973–1974 oil price shock to be permanent • In that case the real interest rate would not necessarily rise • If so, people’s expectations were ...
... – The real interest rate did not rise during the 1973–1974 oil price shock (though it did during the 1979–1980 shock) • It could be that people expected the 1973–1974 oil price shock to be permanent • In that case the real interest rate would not necessarily rise • If so, people’s expectations were ...
Term 2 Week 6 to 9 - Singapore A Level Notes
... Money supply increase – interest rate falls – C/I increase – AD increase – N/ NY increase Japan in 1990s: liquidity trap (draw diagram seen in ‘What is liquidity trap’ notes) – increase money supply – interest rate unchanged because opportunity cost of holding cash balances (earn 0 interest) very lo ...
... Money supply increase – interest rate falls – C/I increase – AD increase – N/ NY increase Japan in 1990s: liquidity trap (draw diagram seen in ‘What is liquidity trap’ notes) – increase money supply – interest rate unchanged because opportunity cost of holding cash balances (earn 0 interest) very lo ...
Chapter 9 Chapter Outline Figure 9.1 The FE line
... expectations, improved modeling of reactions to shocks, and use of newer statistical techniques – The FRB/US model is the workhorse for policy analysis by the Fed’s staff economists – Board of Governor’s staff adjust the FRB/US forecasts with their judgment; the subsequent forecasts reported in the ...
... expectations, improved modeling of reactions to shocks, and use of newer statistical techniques – The FRB/US model is the workhorse for policy analysis by the Fed’s staff economists – Board of Governor’s staff adjust the FRB/US forecasts with their judgment; the subsequent forecasts reported in the ...
Monetary policy
Monetary policy is the process by which the monetary authority of a country controls the supply of money, often targeting an inflation rate or interest rate to ensure price stability and general trust in the currency.Further goals of a monetary policy are usually to contribute to economic growth and stability, to lower unemployment, and to maintain predictable exchange rates with other currencies.Monetary economics provides insight into how to craft optimal monetary policy.Monetary policy is referred to as either being expansionary or contractionary, where an expansionary policy increases the total supply of money in the economy more rapidly than usual, and contractionary policy expands the money supply more slowly than usual or even shrinks it. Expansionary policy is traditionally used to try to combat unemployment in a recession by lowering interest rates in the hope that easy credit will entice businesses into expanding. Contractionary policy is intended to slow inflation in order to avoid the resulting distortions and deterioration of asset values.Monetary policy differs from fiscal policy, which refers to taxation, government spending, and associated borrowing.