The Fed's Monetary Policy Rule: Past, Present and Future

• Autores: Antonio Moreno Ibáñez
• Localización: Working Papers ( Universidad de Navarra. Facultad de Ciencias Económicas y Empresariales ), Nº. 2, 2004, 21 págs.
• Idioma: inglés
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• Resumen

  • This paper has a twofold purpose. In the context of a structural macroeconomic model, it derives estimates of the Federal Reserve's preference parameters in its pre and post - 1980 loss function. We show that there was an economically, but not statistically, significant change in the preferences of the U.S. Fed towards inflation stabilization. We also derive, within a strict inflation targeting regime, the optimal changes in the Fed's reaction to expected inflation as a function of the forward looking parameters in the supply and demand equations.