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Attenuating the forward guidance puzzle: implications for optimal monetary policy
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| Personen und Körperschaften: | , , , |
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| Titel: | Attenuating the forward guidance puzzle: implications for optimal monetary policy/ Taisuke Nakata, Ryota Ogaki, Sebastian Schmidt, Paul Yoo |
| Format: | E-Book |
| Sprache: | Englisch |
| veröffentlicht: |
Frankfurt am Main, Germany
European Central Bank
[2019]
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| Gesamtaufnahme: |
Europäische Zentralbank: Working paper series ; no 2220 (January 2019)
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| Quelle: | Verbunddaten SWB Lizenzfreie Online-Ressourcen |
| Zusammenfassung: | We examine the implications of less powerful forward guidance for optimal policy using a sticky-price model with an effective lower bound (ELB) on nominal interest rates as well as a discounted Euler equation and Phillips curve. When the private-sector agents discount future economic conditions more in making their decisions today, an announced cut in future interest rates becomes less effective in stimulating current economic activity. While the implication of such discounting for optimal policy depends on its degree, we find that, under a wide range of plausible degrees of discounting, it is optimal for the central bank to compensate for the reduced effect of a future rate cut by keeping the policy rate at the ELB for longer. |
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| Umfang: | 1 Online-Ressource (circa 47 Seiten); Illustrationen |
| ISBN: |
9789289934824
9289934824 |
| DOI: | 10.2866/61973 |