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Title:Strategic forecasting on the FOMC PDF Logo
Authors:Tillmann, Peter
Issue Date:2010
Series/Report no.:Joint discussion paper series in economics 17-2010
Abstract:The Federal Open Market Committee (FOMC) of the Federal Reserve consists of voting- and non-voting members. Apart from deciding about interest rate policy, members individually formulate regular inflation forecasts. This paper uncovers systematic differences in individual inflation forecasts submitted by voting and non-voting members. Based on a data set with individual forecasts recently made available it is shown that non-voters systematically overpredict inflation relative to the consensus forecast if they favor tighter policy and underpredict inflation if the favor looser policy. These findings are consistent with non-voting member following strategic motives in forecasting, i.e. non-voting members use their forecast to influence policy deliberation.
Subjects:inflation forecast
forecast errors
monetary policy
monetary committee
Federal Reserve
JEL:E43
E52
Document Type:Working Paper
Appears in Collections:MAGKS Joint Discussion Paper Series in Economics, Universität Marburg

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