Explicit communication from Sarb helped agents predict rate hikes – paper
Authors compare forecasts from 2013 and 2014 to identify whether specific terminology affected forecasting
The use of the term "rising cycle" by policy-makers from the South African Reserve Bank (Sarb) helped economic experts and financial market participants to predict subsequent rate hikes correctly, according to a paper published by the central bank.
Throughout 2014, the Sarb "explicitly" communicated that monetary policy would be on a rising cycle until normalisation was reached.
Since the "rising cycle" talk occurred in early 2014, Alain Kabundi and Ntuthuko Tsokodibane compare the forecasts in
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