Identifying The Effects Of Simultaneous Monetary Policy Shocks
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Identifying The Effects Of Simultaneous Monetary Policy Shocks Enlace externoen Biblioteca Virtual del Banco de la República
Registro bibliográfico
- Título: Identifying The Effects Of Simultaneous Monetary Policy Shocks
- Autor: Villamizar Villegas, Mauricio
- Publicación original: Contemporary Economic Policy; Vol. 34, No. 2, 2015
- Descripción física: PDF
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Nota general:
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Many central banks, particularly in the developing world, aim for exchange rate stability as a macroeconomic goal. However, most are reluctant to relinquish monetary policy autonomy, so they end up operating through both interest rate and foreign exchange interventions. But the use of multiple policy instruments does not necessarily equip monetary authorities with better tools to achieve their targets.
On the contrary, their effects can potentially offset each other. Using daily data from the Central Bank of Colombia during the period of 1999–2012, I study the effects of simultaneous policies by first deriving new measures of monetary shocks and then determining their impact on economic activity.
The main findings indicate that (a) while interest rate interventions have a significant impact on real and nominal variables, foreign exchange interventions tend to have limited effects; and (b) empirical anomalies, such as the positive relationship between output growth, inflation, and the policy rate are eliminated when properly accounting for the systematic responses of policy.
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Many central banks, particularly in the developing world, aim for exchange rate stability as a macroeconomic goal. However, most are reluctant to relinquish monetary policy autonomy, so they end up operating through both interest rate and foreign exchange interventions. But the use of multiple policy instruments does not necessarily equip monetary authorities with better tools to achieve their targets.
- Notas de reproducción original: Digitalización realizada por la Biblioteca Virtual del Banco de la República (Colombia)
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Notas:
- Resumen: Central bank intervention; Simultaneous policies; Monetary shocks; Price puzzle; Monetary policy trilemma; Foreign exchange intervention
- © Derechos reservados del autor
- Colfuturo
- Forma/género: texto
- Idioma: inglés
- Institución origen: Biblioteca Virtual del Banco de la República
- Encabezamiento de materia:
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