Dutch paper quantifies impact of FOMC guidance on market rates
The Federal Open Market Committee (FOMC) turned to forward guidance after dropping the federal funds rate to the lower bound, and a working paper published yesterday by the Netherlands Bank examines the impact of its new communications strategy on market interest rates.
The paper, Effects of Explicit FOMC Policy Rate Guidance on Market Interest Rates, by Richhild Moessner, studies the effects of the committee's guidance on the short-, medium- and long-term interest rates implied by Eurodollar
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