Author: Steven StronginPublisher:
ISBN:
Category : Interest rates
Languages : en
Pages : 34
Book Description
Excess Volatility and the Smoothing of Interest Rates
Author: Steven StronginPublisher:
ISBN:
Category : Interest rates
Languages : en
Pages : 34
Book Description
When Unit Roots Matter
Author: Pieter Cornelis SchotmanPublisher:
ISBN:
Category : Interest rates
Languages : en
Pages : 80
Book Description
Excess Volatility and Excess Smoothness of Long Term Interest Rates
Author: Peter SchotmanWhen Unit Roots Matter
Author: Pieter Cornelis SchotmanPublisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
Interest-rate Smoothing and Optimal Monetary Policy
Author: Brian SackPublisher:
ISBN:
Category : Interest rates
Languages : en
Pages : 54
Book Description
Equilibrium Implications of Interest Rate Smoothing
Author: Diogo DuartePublisher:
ISBN:
Category :
Languages : en
Pages : 48
Book Description
We introduce a macro-finance model in which monetary authorities adjust the money supply by targeting not only output and inflation but also the slope of the yield curve. We study the impact of McCallum-type rules on capital growth, the volatility of interest rates, the spread between long- and short-term rates, the persistence of monetary shocks and equity volatility. Our model supports the Federal Reserve's choice to incorporate financial data in their policy decisions and expand the monetary base to decrease the nominal interest rate spread at the cost of lower expected long-term growth.
Excess volatility and excess smoothness of long term interest rates
Author: Peter SchotmanMonetary Policy and the Behaviour of Interest Rates
Author: Stefan GerlachPublisher:
ISBN:
Category : Capital market
Languages : en
Pages : 42
Book Description
Monetary Policy Rules and the Exchange Rate
Author: Gianluca BenignoPublisher:
ISBN:
Category : Foreign exchange rates
Languages : en
Pages : 72
Book Description
Interest Rate Smoothing and Financial Stability
Author: R. Todd SmithPublisher:
ISBN:
Category :
Languages : en
Pages : 32
Book Description
Central banks smooth fluctuations in interest rates based on a belief that this policy promotes financial stability. This belief is based on a presumption that the direct effect of less interest rate volatility on a bank's likelihood of insolvency is the predominant effect of this policy. The main point of this paper is that these policies also give rise to indirect effects that lower financial stability. These indirect effects occur because the policy itself alters bank behavior. In effect, if the central bank provides (liquidity) insurance (at zero premia), it may introduce a classic moral hazard problem that encourages risk-taking by banks. As a result, to maintain a given degree of financial stability, a bank regulator may, in fact, need to impose a higher prudential capital requirement when an interest rate smoothing policy is in place. The paper concludes that the link between interest rate smoothing policy and financial stability may be more complicated than is generally recognized.