EconPapers    
Economics at your fingertips  
 

Announcements of Interest Rate Forecasts: Do Policymakers Stick to Them?

Nikola Mirkov and Gisle Natvik

No 1303, Working Papers on Finance from University of St. Gallen, School of Finance

Abstract: If central banks value the ex-post accuracy of their forecasts, previously announced interest rate paths might affect the current policy rate. We explore whether this “forecast adherence” has influenced the monetary policies of the Reserve Bank of New Zealand and the Norges Bank, the two central banks with the longest history of publishing interest rate paths. We derive and estimate a policy rule for a central bank that is reluctant to deviate from its forecasts. The rule can nest a variety of interest rate rules. We find that policymakers appear to be constrained by their most recently announced forecasts.

Keywords: Interest rates; forecasts; Taylor rule; adherence. (search for similar items in EconPapers)
JEL-codes: E43 E52 E58 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2013-04
New Economics Papers: this item is included in nep-cba, nep-for, nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
http://ux-tauri.unisg.ch/RePEc/usg/sfwpfi/WPF-1303.pdf (application/pdf)

Related works:
Journal Article: Announcements of Interest Rate Forecasts: Do Policymakers Stick to Them? (2016) Downloads
Working Paper: Announcements of interest rate forecasts: Do policymakers stick to them? (2013) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:usg:sfwpfi:2013:03

Access Statistics for this paper

More papers in Working Papers on Finance from University of St. Gallen, School of Finance Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2025-03-22
Handle: RePEc:usg:sfwpfi:2013:03