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The Determinants and Properties of Monetary Conditions: Direct Survey Evidence from New Zealand


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  • Andreas Fischer
  • Adrian Orr


In the absence of a generally accepted indicator of monetary conditions the current and expected stance of monetary policy remains undefined. However, the Reserve Bank of New Zealand, by directly surveying perceived and expected monetary conditions, have enabled both a mean index of current and future monetary conditions, as well as a proxy of respondents’ uncertainty, to be generated. The principal determinants and properties of these survey responses are examined in this paper, including whether: central bank announcements dominate economic fundamentals in determining conditions; the responses are consistent over varying time horizons; and the responses are symmetrical to both a tightening and loosening in policy. The determinants of uncertainty regarding the policy-stance are also investigated empirically. The results indicate that: responses to monetary conditions are highly influenced by the recent past; respondents tend to exaggerate the implications of their short-term ... En l’absence d’un indicateur des conditions monétaires ayant fait l’objet d’un consensus général, l’orientation courante et anticipée de la politique monétaire dmeure mal définie. Néanmoins, la Banque Centrale de Nouvelle-Zélande, à l’aide d’un sondage recueillant directement les opinions sur les conditions monétaires actuelles et anticipées, a construit à la fois un indice moyen des conditions monétaires présentes et futures ainsi qu’une proxy sur l’incertitude des personnes interrogées. Les réponses du sondage permettent d’examiner les déterminants principaux et les caractéristiques des conditions monétaires, par exemple, si les annonces de la Banque Centrale l’emportent sur les paramètres fondamentaux économiques dans la détermination des conditions monétaires ; les réponses sont comparables entre différents horizons temporels, elles sont aussi symétriques dans la perception des politiques restrictives et expansives. Les facteurs à l’origine de l’incertitude concernant ...

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Bibliographic Info

Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 150.

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Date of creation: 1994
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Handle: RePEc:oec:ecoaaa:150-en

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Cited by:
  1. Leo Bonato & Robert St. Clair & Rainer Winkelmann, 1999. "Survey expectations of monetary conditions in New Zealand: determinants and implications for the transmission of policy," Reserve Bank of New Zealand Discussion Paper Series G99/6, Reserve Bank of New Zealand.
  2. Andrzej Toroj, 2008. "Estimation of weights for the Monetary Conditions Index in Poland," Working Papers 27, Department of Applied Econometrics, Warsaw School of Economics.


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