18 results with keyword: 'discretionary monetary policy zero lower bound nominal rates'
The dependence of the size of the consumption losses on the steady state real interest rate, displayed in fi gure 1, suggests that the lower bound in fl icts sizable welfare
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This is illustrated in fi gure 1, which reports the increase in the consumption losses associated with taking into account the zero lower bound under discretionary policy, as a
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Instead of attempting to raise infl ation expectations, central banks sought to lower interest rates further along the yield curve by providing more certainty about policy rates
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Keywords : monetary policy rules, zero-interest-rate bound, liquidity trap, rational expec- tations, nominal rigidities, exchange rates, monetary transmission.. ∗
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The above discussion suggests that adopting a target path for the price level can effectively allow the central bank to achieve a lower average rate of inflation in the economy
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Keywords: monetary policy rules, zero interest rate bound, liquidity trap, rational expectations, nominal rigidities, exchange rates, monetary transmission...
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We analyse the macroeconomic effects of a protracted period of low and falling inflation rates when monetary policy is constrained by the zero lower bound (ZLB) on nominal
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Keywords: Optimal monetary policy, …nancial accelerator, lower bound on nominal interest rates, price-level targeting, …scal
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Intuitively, if monetary policy is unable to lower the current nominal interest rate further, because the zero bound is binding, future monetary policy will have to stabilize
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Optimal discretionary policy that targets an average inflation rate of zero implies that shocks to the so-called ‘natural’ real rate of interest cause the lower bound to become
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Third, as argued by Jung, Teranishi, and Watanbe (2001) and Eggertsson and Woodford (2003) optimal policy reacts to a binding zero lower bound on nominal interest rates by creating
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Third, as argued by Jung, Teranishi, and Watanabe (2001) and Eggerts- son and Woodford (2003) optimal policy reacts to a binding zero lower bound on nominal interest rates by
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Overview of maximum output losses and minimum nominal interest rates under different shock scenarios and monetary policy rules in the “old regime”.. Further scenario details as well
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Intuitively, if monetary policy is unable to lower the current nominal interest rate further, because the zero bound is binding, future monetary policy will have to stabilize
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In this paper, we build on Svensson’s (1997) inflation targeting framework by explicitly taking into account the lagged effect of monetary policy and characterize the optimal
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This would help communicate to markets how it is that the purchase program is consistent with a steady state with inflation at target and output at potential.. This would
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“The Zero Bound on Nominal Interest Rates: Implications for the Optimal Monetary Policy in Canada.” Bank of Canada Discussion Paper No. “Strategic Complementarities and Optimal
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Once the nominal interest rate reaches the zero lower bound (ZLB), monetary policy looses the ability to stimulate the economy by further reducing the nominal interest rate. Yet,
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