290
result(s)
Central Bank Communication That Works: Lessons from Lab Experiments
Staff Working Paper 2019-21
Oleksiy Kryvtsov,
Luba Petersen
We use controlled laboratory experiments to test the causal effects of central bank communication on economic expectations and to distinguish the underlying mechanisms of those effects. In an experiment where subjects learn to forecast economic variables, we find that central bank communication has a stabilizing effect on individual and aggregate outcomes and that the size of the effect varies with the type of communication.
Content Type(s):
Staff Research,
Staff Working Papers
Topic(s):
Monetary policy implementation,
Transmission of monetary policy
JEL Code(s):
C,
C9,
D,
D8,
D84,
E,
E3,
E5,
E52
Central Bank Digital Currency and Banking
Staff Working Paper 2019-20
Jonathan Chiu,
Mohammad Davoodalhosseini,
Janet Hua Jiang,
Yu Zhu
Many central banks are considering whether to issue a new form of electronic money that would be accessible to the public. This new form is usually called a central bank digital currency (CBDC). Issuing a CBDC would have implications on the financial system and more broadly on the wider economy.
Content Type(s):
Staff Research,
Staff Working Papers
Topic(s):
Digital Currencies and Fintech,
Market structure and pricing,
Monetary Policy,
Monetary policy framework
JEL Code(s):
E,
E5,
E50,
E58
Labor Mobility in a Monetary Union
Staff Working Paper 2019-15
Daniela Hauser,
Martin Seneca
The optimal currency literature has stressed the importance of labor mobility as a precondition for the success of monetary unions. But only a few studies formally link labor mobility to macroeconomic adjustment and policy. In this paper, we study macroeconomic dynamics and optimal monetary policy in an economy with cyclical labor flows across two distinct regions that share trade links and a common monetary framework.
Content Type(s):
Staff Research,
Staff Working Papers
Topic(s):
Business fluctuations and cycles,
Economic models,
Labour markets,
Monetary policy framework,
Regional economic developments
JEL Code(s):
E,
E3,
E32,
E5,
E52,
F,
F4
The Distributional Effects of Conventional Monetary Policy and Quantitative Easing: Evidence from an Estimated DSGE Model
Staff Working Paper 2019-6
Stefan Hohberger,
Romanos Priftis,
Lukas Vogel
This paper compares the distributional effects of conventional monetary policy and quantitative easing (QE) within an estimated open-economy DSGE model of the euro area.
Content Type(s):
Staff Research,
Staff Working Papers
Topic(s):
Economic models,
Interest rates,
Monetary Policy,
Transmission of monetary policy
JEL Code(s):
E,
E4,
E44,
E5,
E52,
F,
F4,
F41
Limited Commitment, Endogenous Credibility and the Challenges of Price-level Targeting
Staff Working Paper 2018-61
Gino Cateau,
Malik Shukayev
This paper studies the cost of limited commitment when a central bank has the discretion to adjust policy whenever the costs of honoring its past commitments become high. Specifically, we consider a central bank that seeks to implement optimal policy in a New Keynesian model by committing to a price-level target path.
Content Type(s):
Staff Research,
Staff Working Papers
Topic(s):
Credibility,
Inflation targets,
Monetary policy framework
JEL Code(s):
E,
E3,
E31,
E5,
E52
Credibility, Flexibility and Renewal: The Evolution of Inflation Targeting in Canada
Staff Discussion Paper 2018-18
Thomas J. Carter,
Rhys R. Mendes,
Lawrence L. Schembri
In 1991, Canada became the second country to adopt an inflation target as a central pillar of its monetary policy framework. The regime has proven much more successful than initially expected, both in achieving price stability and in stabilizing the real economy against a wide range of shocks.
Content Type(s):
Staff Research,
Staff Discussion Papers
Topic(s):
Credibility,
Inflation targets,
Monetary Policy,
Monetary policy framework
JEL Code(s):
E,
E5,
E52,
E58,
E6,
E61
Disaggregating Household Sensitivity to Monetary Policy by Expenditure Category
Staff Analytical Note 2018-32
Tony Chernis,
Corinne Luu
Because the Bank of Canada has started withdrawing monetary stimulus, monitoring the transmission of these changes to monetary policy will be important. Subcomponents of consumption and housing will likely respond differently to a monetary policy tightening, both in terms of the aggregate effect and timing.
Content Type(s):
Staff Research,
Staff Analytical Notes
Topic(s):
Business fluctuations and cycles,
Domestic demand and components,
Econometric and statistical methods,
Housing,
Interest rates,
Recent economic and financial developments,
Transmission of monetary policy
JEL Code(s):
C,
C3,
C32,
E,
E2,
E21,
E22,
E4,
E43,
E47,
E5,
E52
Monetary Policy Uncertainty: A Tale of Two Tails
Staff Working Paper 2018-50
Tatjana Dahlhaus,
Tatevik Sekhposyan
We document a strong asymmetry in the evolution of federal funds rate expectations and map this observed asymmetry into measures of monetary policy uncertainty. We show that periods of monetary policy tightening and easing are distinctly related to downside (policy rate is higher than expected) and upside (policy rate is lower than expected) uncertainty.
Content Type(s):
Staff Research,
Staff Working Papers
Topic(s):
Business fluctuations and cycles,
Econometric and statistical methods,
Monetary policy communications,
Transmission of monetary policy,
Uncertainty and monetary policy
JEL Code(s):
C,
C1,
C18,
C3,
C32,
E,
E0,
E02,
E4,
E43,
E5,
E52
Price Selection
Staff Working Paper 2018-44
Carlos Carvalho,
Oleksiy Kryvtsov
We propose a simple, model-free way to measure price selection and its impact on inflation. Price selection exists when prices that change in response to aggregate shocks are not representative of the overall population of prices. Due to selection, increases (decreases) in inflation can be amplified because adjusting prices tend to originate from levels far below (above) the average.
Content Type(s):
Staff Research,
Staff Working Papers
Topic(s):
Business fluctuations and cycles,
Inflation and prices,
Transmission of monetary policy
JEL Code(s):
E,
E3,
E31,
E5,
E51
Following the Money: Evidence for the Portfolio Balance Channel of Quantitative Easing
Staff Working Paper 2018-33
Itay Goldstein,
Jonathan Witmer,
Jing Yang
Recent research suggests that quantitative easing (QE) may affect a broad range of asset prices through a portfolio balance channel. Using novel security-level holding data of individual US mutual funds, we establish evidence that portfolio rebalancing occurred both within and across funds.
Content Type(s):
Staff Research,
Staff Working Papers
Topic(s):
Monetary Policy,
Monetary policy implementation,
Transmission of monetary policy
JEL Code(s):
E,
E5,
E58,
G,
G2,
G23