Herding Behaviour of Central Banks: Following the Fed and ECB

Jakub Bureš
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Jakub Bureš: Mendel University in Brno, Czech Republic

European Journal of Business Science and Technology, 2017, vol. 3, issue 1, 21-28

Abstract: I apply interest rate rules, especially the Taylor rule, to identify basic determinants of the central banks' decision-making process. The results confirmed herding behaviour related to the central bank financial assets and its economic power in the US and Eurozone. The conclusions are discussed in relation to the exchange rate movements and capital flows. The empirical strategy reflects different lag structure and employs autoregressive distributed lag models.

Keywords: interest rates; Taylor rule; central banks; currency war (search for similar items in EconPapers)
JEL-codes: C23 E43 (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:men:journl:v:3:y:2017:i:1:p:21-28

DOI: 10.11118/ejobsat.v3i1.63

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