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Now showing items 11-20 of 49
Central banking with many voices: the communications arms race
The job of central bankers is to use the monetary powers granted to them to promote price stability, sustainable growth, and a stable financial system. They do this in an environment fraught with unavoidable uncertainties. But, in conducting policy...
Inflation target transparency and the macroeconomy
Over the last twenty years, many central banks have adopted increasing standards of transparency in communicating their monetary policy objectives, in particular regarding the explicit definition and quantification of their price stability objective or inflation target. One important benefit of increased ...
Optimal monetary policy rules under inflation range targeting
Central banks resort to a variety of alternative arrangements in formulating, conducting, and communicating monetary policy. One increasingly popular type of arrangement is based on a target range for inflation. In this setup the conduct of monetary policy is oriented to keeping inflation withing ...
Expectations, learning and monetary policy: an overview of recent research
The conduct of monetary policy in terms of interest rate or other rules has been extensively studied in recent research. This literature gives a central role to forecasts of future inflation and output, and the question of whether monetary policy should be forward- ooking has been subject to discussion ...
Sources of uncertainty in conducting monetary policy in Chile
Monetary policy is made in an environment of substantial uncertainty. Consequently, academic researchers have sought to formally demonstrate the implications of uncertainty, as well as the ways in which central banks can manage it. The theoretical literature on uncertainty distinguishes between three ...
Learning, endogenous indexation, and disinflation in the new-keynesian model
Developing a better understanding of the costs of disinflation has long been an important objective for macroeconomic research. Since the 1980s, disinflation episodes and strategies have been studied extensively under the assumption of rational expectations. This assumption implies that central bank ...
Negative interest rates: lessons from the Euro area
In June 2014 the European Central Bank (ECB) decided to cut the rate on its deposit facility (DFR) by 10 basis points (bp) into negative territory an unprecedented move as no major central bank had used negative rates before. This decision was part of a more comprehensive monetary policy easing package ...
Monetary policy at the zero lower bound: the Chilean experience
The global financial crisis that started in 2008 dramatically changed the analysis and implementation of monetary policy worldwide. Central banks were at the center of the stage during that time implementing both conventional and unconventional policies. Not only were monetary policy rates drastically ...
Monetary policy in the grip of a pincer movement
Monetary policy has come under strain since the global financial crisis (GFC) of 2007–09. Once the GFC broke out central banks’ swift and determined response was essential to stabilise markets and to avoid a self-reinforcing downward spiral between the financial system and the real economy. But putting ...
Sterilized foreign exchange interventions under inflation targeting
Inflation targeting needs exchange rate flexibility. If the policy interest rate is geared to achieving the inflation target the central bank must be willing to accept the resulting exchange rate. Simply put if the central bank has both an inflation target and an exchange rate target the private sector ...