Communicating policy options at the zero bound

Lukas Burkhard and Andreas Fischer ()

Journal of International Money and Finance, 2009, vol. 28, issue 5, 742-754

Abstract: This paper examines a special episode in communication practices of the Swiss National Bank (SNB) when short-term interest rates reached the zero bound. Non-sterilized foreign exchange interventions were frequently mentioned as a potential instrument. We ask how the financial markets responded to the SNB's repeated references of non-sterilized interventions? The empirical results with high-frequency data provide strong evidence that SNB intervention references depreciated the domestic currency for several hours. The case study supports the view that communication is an effective tool for monetary policy in unusual situations, as well.

Keywords: Exchange; rate; Central; bank; communication; Zero; bound (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (26)

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Related works:
Working Paper: Communicating Policy Options at the Zero Bound (2007)
Working Paper: Communicating Policy Options at the Zero Bound (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jimfin:v:28:y:2009:i:5:p:742-754

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