Arbeitspapier
Forward guidance in an advanced small open economy in the effective lower bound
We examine forward guidance (with known and uncertain duration) in a New Keynesian model for an advanced small open economy, showing that the response of the economy to this policy depends, both quantitatively and qualitatively, on some structural features through calibrations for Sweden and Spain. In particular, an announcement of future expansionary policy is positively related to the exchange rate pass-through and is larger than in the closed economy counterpart because of a better inflation-output trade-off and the exchange rate channel. We also show that multiple equilibria could arise and that the real exchange rate is a key variable driving this result. In particular, the response of output and inflation is amplified when aggregate supply is negatively related to the real exchange rate. These results could not necessarily be extended to emerging market economies.
- Sprache
-
Englisch
- Erschienen in
-
Series: Working Papers ; No. 2021-16
- Klassifikation
-
Wirtschaft
Price Level; Inflation; Deflation
Monetary Policy
- Thema
-
Monetary policy
advanced small open economy
forward guidance
- Ereignis
-
Geistige Schöpfung
- (wer)
-
André, Marine Charlotte
Traficante, Guido
- Ereignis
-
Veröffentlichung
- (wer)
-
Banco de México
- (wo)
-
Ciudad de México
- (wann)
-
2021
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:43 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- André, Marine Charlotte
- Traficante, Guido
- Banco de México
Entstanden
- 2021
Ähnliche Objekte (12)
Investigating the zero lower bound on the nominal interest rate under financial instability
Peso-Dollar forward market analysis: Explaining arbitrage opportunities during the financial crisis
Forward guidance at the effective lower bound: International experience
Forward Guidance in a Simple Model with a Zero Lower Bound
Forward Guidance in a Simple Model with a Zero Lower Bound
Geldschein, 50 Pesos, 9.8.1933
Labor heterogeneity and the pattern of trade
Decisiones financieras, competencia en el mercado y desempeño de las empresas: Evidencia emprica para Iberoamerica
Price-setting in Mexico and the real effects of monetary shocks
The role of credit on the evolution of wealth inequality in the USA
Forecasting short-run inflation volatility using futures prices: An empirical analysis from a value at risk perspective
Measuring the cost of U.S. housing policy
Investigating the zero lower bound on the nominal interest rate under financial instability
Peso-Dollar forward market analysis: Explaining arbitrage opportunities during the financial crisis
Forward guidance at the effective lower bound: International experience
Forward Guidance in a Simple Model with a Zero Lower Bound
Forward Guidance in a Simple Model with a Zero Lower Bound
Geldschein, 50 Pesos, 9.8.1933
Labor heterogeneity and the pattern of trade
Decisiones financieras, competencia en el mercado y desempeño de las empresas: Evidencia emprica para Iberoamerica
Price-setting in Mexico and the real effects of monetary shocks
The role of credit on the evolution of wealth inequality in the USA
Forecasting short-run inflation volatility using futures prices: An empirical analysis from a value at risk perspective
Measuring the cost of U.S. housing policy
Investigating the zero lower bound on the nominal interest rate under financial instability
Peso-Dollar forward market analysis: Explaining arbitrage opportunities during the financial crisis
Forward guidance at the effective lower bound: International experience
Forward Guidance in a Simple Model with a Zero Lower Bound
Forward Guidance in a Simple Model with a Zero Lower Bound
Geldschein, 50 Pesos, 9.8.1933
Labor heterogeneity and the pattern of trade
Decisiones financieras, competencia en el mercado y desempeño de las empresas: Evidencia emprica para Iberoamerica
Price-setting in Mexico and the real effects of monetary shocks
The role of credit on the evolution of wealth inequality in the USA
Forecasting short-run inflation volatility using futures prices: An empirical analysis from a value at risk perspective