FOMC forecasts as a focal point for private expectations

Paul Hubert

No 2013-12, Documents de Travail de l'OFCE from Observatoire Francais des Conjonctures Economiques (OFCE)

Abstract: We explore empirically the theoretical prediction that public information acts as a focal point in the context of the US monetary policy. We aim at establishing whether the publication of FOMC inflation forecasts affects the cross-sectional dispersion of private inflation expectations. Our main finding is that publishing FOMC inflation forecasts has a negative effect on the cross-sectional dispersion of private current-year inflation forecasts. This effect is found to be robust to another survey dataset and to various macroeconomic controls. Moreover, we find that the dispersion of private inflation forecasts is not affected by the dispersion of views among FOMC members.

Keywords: monetary policy; central bank communication; public information; survey expectations; dispersion (search for similar items in EconPapers)
JEL-codes: E37 E52 E58 (search for similar items in EconPapers)
Date: 2013-07
New Economics Papers: this item is included in nep-cba, nep-for, nep-mac and nep-mon
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: FOMC Forecasts as a Focal Point for Private Expectations (2014)
Working Paper: FOMC Forecasts as a Focal Point for Private Expectations (2014)
Working Paper: FOMC Forecasts as a Focal Point for Private Expectations (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:fce:doctra:1312

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