Liquidity and Irish Interest Rates
AbstractIn recent papers (1993a and b) we have focused on the role of expectations in influencing Irish interest rates during the EMS period. Here we examine the role of monetary policy actions more directly, and explore the relation between interest rates, on the one hand, and actions of the monetary authorities in supplying liquidity to, and withdrawing it from, the market on the other. Though it is not clear just how effective recent Central Bank liquidity interventions have been in influencing interest rates, there is evidence of a change in policy towards a more aggressive attempt to stabilize rates after mid-1988. Before then, the reaction of Central Bank intervention to interest rate pressures was very modest (£20 million per one per cent movement in interest rates)and the impact cannot have been great.
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Bibliographic InfoPaper provided by Economic and Social Research Institute (ESRI) in its series Papers with number WP052.
Length: 11 pages
Date of creation: Mar 1994
Date of revision:
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- Patrick Honohan, 1994. "Interest Rate Policy in Practice: A Review with some Implications for the Irish Banking System in the EMS," Papers WP046, Economic and Social Research Institute (ESRI).
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CEPR Discussion Papers
369, C.E.P.R. Discussion Papers.
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NBER Working Papers
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"In search of the liquidity effect,"
International Finance Discussion Papers
403, Board of Governors of the Federal Reserve System (U.S.).
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- Edward E. Leamer, 1979.
"Is it a Demand Curve, or is it a Supply Curve?: Partial Identification Through Inequality Constraints,"
UCLA Economics Working Papers
153, UCLA Department of Economics.
- Leamer, Edward E, 1981. "Is It a Demand Curve, or Is It a Supply Curve? Partial Identification through Inequality Constraints," The Review of Economics and Statistics, MIT Press, vol. 63(3), pages 319-27, August.
- John Coleman, Wilbur II & Gilles, Christian & Labadie, Pamela, 1992.
"The liquidity premium in average interest rates,"
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Elsevier, vol. 30(3), pages 449-465, December.
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