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Social and Behavioral Sciences Commons™
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Full-Text Articles in Social and Behavioral Sciences
Interest Rate Setting At The Ecb Following The Financial And Sovereign Debt Crises, In Real Time, Sharmila K. King, Florence Bouvet
Interest Rate Setting At The Ecb Following The Financial And Sovereign Debt Crises, In Real Time, Sharmila K. King, Florence Bouvet
College of the Pacific Faculty Articles
We analyse European Central Bank (ECB) policy by estimating a forward-looking, augmented Taylor rule using expectations data. Specifically, we investigate the impact of the financial and sovereign debt crises on ECB policy. We find the European Overnight Index Average (EONIA) rises when expected economic activity is strong. Regardless of the inflation measure, inflation is not associated with the EONIA. Using a recursive estimation and a Chow test, we identify a policy shift in December 2008. The more generally accepted starting date of the crisis, August 2007, does not correspond to a statistically significant shift in the ECB policy. Using December …
How European Is The European Central Bank's Monetary Policy?, Teodora D. Petrova
How European Is The European Central Bank's Monetary Policy?, Teodora D. Petrova
Honors Projects
Ever since its establishment in 1999, the European Central Bank worked on maintaining relative price stability mainly through inflation targeting. The ECB aims at a target inflation rate below but close to 2%. However, the diversity among the member states in the European Union and the Eurozone requires not only collective attention on the EU economy but also on each individual member state. Some Eurozone member states experience generally higher levels of inflation and higher unemployment. On the other side are countries like Germany which are more concerned with maintaining low inflation only. Many economists and politicians criticize the ECB …