Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/129067
Authors: 
Bletzinger, Tilman
Wieland, Volker
Year of Publication: 
2016
Series/Report no.: 
IMFS Working Paper Series 102
Abstract: 
A number of contributions to research on monetary policy have suggested that policy should be asymmetric near the lower bound on nominal interest rates. As inflation and economic activity decline, policy should ease more aggressively than it would in the absence of the lower bound. As activity recovers and inflation picks up, the central bank should act to keep interest rates lower for longer than without the bound. In this note, we investigate to what extent the policy easing implemented by the ECB since summer 2013 mirrors the rate recommendations of a simple policy rule or deviates from it in a way that indicates a 'lower for longer' approach to policy near zero interest rates.
Subjects: 
monetary policy
interest rates
European Central Bank
forward guidance
zero lower bound
JEL: 
E43
E47
E52
E58
Document Type: 
Working Paper

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