A guide to nominal feedback rules and their use for monetary policy
If price stability is to be sustained, monetary policy actions will inevitably resemble - in the long run - the prescriptions from nominal feedback rules, which are designed to achieve price stability. This property means that monetary policy might be well described by a nominal feedback rule in a low-inflation country such as Switzerland. In this article, Michael J. Dueker an Andreas M. Fischer provide a general description of nominal feedback rules and use one rule - with time-varying parameters - to model Swiss monetary policy actions. The authors explain how this indicator model can presage a buildup of inflationary pressures before they become obvious through other traditional policy indicators.
Volume (Year): (1998)
Issue (Month): Jul ()
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- Dueker, Michael & Fischer, Andreas M., 1996.
"Inflation targeting in a small open economy: Empirical results for Switzerland,"
Journal of Monetary Economics,
Elsevier, vol. 37(1), pages 89-103, February.
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