Do financial markets learn from ECB monetary policy?

Jean-Yves Filbien and Fabien Labondance

Economics Letters, 2013, vol. 120, issue 2, 271-275

Abstract: This article examines the magnitude of stock market reactions to European Central Bank (ECB) monetary policy announcements. Since the introduction of the ECB, declining absolute abnormal returns have been compatible with the theory that stock markets learn from ECB monetary policy. In particular, Eurozone financial markets extract information from the ECB announcements and consider this information before making investment decisions. Furthermore, the predictability of ECB monetary policy has been increasing over time.

Keywords: Monetary policy; CAR; Learning (search for similar items in EconPapers)
JEL-codes: E52 E58 G14 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:120:y:2013:i:2:p:271-275

DOI: 10.1016/j.econlet.2013.04.002

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