Monetary Policy Transparency and Uncertainty: A Comparison between the Bank of England and the Bundesbank/ECB
It is widely believed that institutional arrangements influence the quality of monetary policy outcomes. Judged on its ‘transparency’ characteristics, therefore the Bank of England should do better than the Bundesbank/ECB. We show that this is not confirmed by agents’ ability to anticipate central bank decisions. Furthermore, benefits from transparency should also show in a narrowing of the diversity in cross sectional forecasts. We show that the diversity in interest rate forecasts is no greater under the Bundesbank/ECB than the Bank of England. This suggests that other factors than ‘transparency’ may affect interest rate uncertainty. Increasing difficulty in forecasting inflation appears to play a part in the UK while being less of a problem in Germany.
|Date of creation:||Oct 2005|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: 0117 328 3610
Web page: http://www1.uwe.ac.uk/bl/research/bristoleconomics.aspx
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Georgios Chortareas & David Stasavage & Gabriel Sterne, 2003. "Does monetary policy transparency reduce disinflation costs?," Manchester School, University of Manchester, vol. 71(5), pages 521-540, 09.
- Andrew G Haldane & Vicky Read, 2000. "Monetary policy surprises and the yield curve," Bank of England working papers 106, Bank of England.
- Pérez Quirós, Gabriel & Sicilia, Jorge, 2002.
"Is the European Central Bank (and the United States Federal Reserve) predictable?,"
Working Paper Series
0192, European Central Bank.
- Gabriel Pérez Quirós & Jorge Sicilia, 2002. "Is the European Central Bank (and the United States Federal Reserve) predictable?," Banco de Espa�a Working Papers 0229, Banco de Espa�a.
- International Monetary Fund, 1998. "Anticipation and Surprises in Central Bank Interest Rate Policy; The Case of the Bundesbank," IMF Working Papers 98/43, International Monetary Fund.
- William Poole & Robert H & Rasche & Daniel L. Thornton, 2002. "Market anticipations of monetary policy actions," Review, Federal Reserve Bank of St. Louis, issue Jul, pages 65-94.
- Daniel L. Thornton, 2003.
"Monetary policy transparency: transparent about what?,"
2002-028, Federal Reserve Bank of St. Louis.
- Daniel L. Thornton, 2003. "Monetary policy transparency: transparent about what?," Manchester School, University of Manchester, vol. 71(5), pages 478-497, 09.
When requesting a correction, please mention this item's handle: RePEc:uwe:wpaper:0508. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Felix Ritchie)
If references are entirely missing, you can add them using this form.