Where Have the Monetary Surprises Gone? The Effects of FOMC Statements

Andrew Swiston

No 2007/185, IMF Working Papers from International Monetary Fund

Abstract: This paper examines the impact of central bank communication on market expectations of monetary policy and long-term interest rates by comparing Federal Open Market Committee (FOMC) action dates when a policy statement was made to dates before statements were issued. Increased communication has been associated with a reduction in the magnitude of short-term monetary surprises; a greater flow of information about the long-term path of policy that is distinct from the short-term surprise; and a larger role for these long-term surprises in the determination of long-term interest rates.

Keywords: WP; interest rate; monetary policy; yield; market (search for similar items in EconPapers)
Pages: 24
Date: 2007-07-01
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Citations: View citations in EconPapers (9)

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