The Role of the Exchange Rate in Monetary-Policy Rules

By John B. Taylor. 2001

695 citations recorded by the source corpus.

Subfields: Economics and Econometrics, Finance

View Paper: https://www.semanticscholar.org/paper/475909e51a127f81579457ebf42bebea449efca5

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Citations in the corpus

REAL EFFECTS OF MONETARY POLICY IN LARGE EMERGING ECONOMIES (2011, background): “…the potential inclusion of the exchange rate in the central bank’s reaction function would not contradict the objectives of central banks, in particular if exchange rate stabilization is a precondition for both output stabilization and bringing down inflation to a targeted level [Taylor (2001)].”
How the ECB and the US Fed set interest rates (2007, methodology): “As discussed in Taylor (2001), an appreciation of the euro leads to a relaxation of monetary policy.”
Monetary Policy, Market Excesses and Financial Turmoil (2008, background): “Japan (1995-98) and New Zealand (1986-88) are not classified as episodes, as in both cases Taylor rates were artificially high due to one-off jumps in inflation driven by significant increases in consumption tax. Switzerland (1990-92) is also not classified as an episode, as the Taylor rate was also”
Monetary Policy Rules, Asset Prices, and Exchange Rates (2003, methodology): “It has become commonplace to characterize monetary policy as the minimization of inefficient economic fluctuations via the implementation of an interest rate rule (see Taylor, 1993, 1999, 2001).”
Monetary Policy Rules for an Open Economy (2003, background): “See Taylor (2001) for a discussion of this terminology.”
Exchange Arrangements Entering the 21st Century: Which Anchor Will Hold? (2017, neutral): “The late Ronald McKinnon, in several of his papers on what 22 See also Faudot and Ponsot (2016). he called East Asia’s dollar standard, emphasized this point.”
Asset Prices, Financial Imbalances and Monetary Policy: Are Inflation Targets Enough? (2003, neutral): “…has recently been a lively literature debating the extent to which monetary policy should respond to asset price movements (see e.g. Batini and Nelson (2000), Bernanke and Gertler (1999) (2001), Cecchetti, Genberg, Lipsky and Wadhwani (2000), Cecchetti, Genberg and Wadhwani (2003), Taylor (2001).”
Monetary policy and exchange rate overshooting: Dornbusch was right after all* (2009, background): “This may in itself provide important information about the expected development of the determinants of the targeting variables that the central bank may want to react to, see Obstfeld and Rogoff (1995) and Taylor (2001) for arguments, and Clarida et al. (1998) for empirical evidence.”
Do Central Banks Respond to Exchange Rate Movements? A Structural Investigation (2007, background): “…effects the more open the economy is and the more distorted, in which case the central bank may optimally chose a more anti-inflationary policy.10 9However, our estimates tend to be overall lower than those found optimal in the theoretical literature; see our discussion above and Taylor (2001).”
Determinacy and Learnability of Monetary Policy Rules in Small Open Economies (2006, background): “An additional concern is whether movements in the exchange rate have to be included in the policy rule besides the standard elements such as inflation and the output gap; see Taylor (2001).”
Monetary policy in the UK (2007, neutral): “The possibility of incorporating exchange rates and other variables, as argued above, in both a Taylor Rules formulation and in an explicit optimization monetary rules type of formulation has been discussed in the literature ( Taylor, 2001; Svensson, 2000, 2003).”
New Consensus Macroeconomics: A Critical Appraisal (2009, background): “The argument is then that such focus and acceptance outrightly of the EMH leads to serious mistakes in terms of monetary policy.17 Asset-price targeting may be necessary after all; see Wadhwani (2008) for a recent restatement.”