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A monetary policy rule based on nominal and inflation-indexed treasury yields

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A monetary policy rule based on nominal and inflation-indexed treasury yields
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Brian Sack1 editions

"The yields on nominal and inflation-indexed Treasury debt securities can be used to derive a proxy for the inflation expectations of financial market participants. This paper finds that one such measure has been an effective predictor of monetary policy decisions by the Federal Reserve since 1999. This finding suggests that the inflation compensation measure serves as a summary statistic for the factors that drive monetary policy decisions"--Federal Reserve Board web site.

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  • Brian Sack

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