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Effects of explicit FOMC policy rate guidance on interest rate expectations

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  • Moessner, Richhild

Abstract

We quantify the impact of explicit FOMC policy rate guidance announcements at the zero lower bound on Eurodollar interest rate futures. We find that they significantly reduced implied interest rates and led to a flattening of the yield curve.

Suggested Citation

  • Moessner, Richhild, 2013. "Effects of explicit FOMC policy rate guidance on interest rate expectations," Economics Letters, Elsevier, vol. 121(2), pages 170-173.
    • Handle: RePEc:eee:ecolet:v:121:y:2013:i:2:p:170-173
    DOI: 10.1016/j.econlet.2013.07.023
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    References listed on IDEAS

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    More about this item

    Keywords

    Monetary policy; Central bank communication; Policy rate guidance;
    All these keywords.

    JEL classification:

    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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