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RBA Glossary definition for IT
IT – Information Technology
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Credit Spreads, Monetary Policy and the Price Puzzle
28 Jan 2020
RDP
2020-01
Inflation does not rise in response to an increase in the policy rate but, instead, the central bank raises its policy rate when it expects inflation to increase in the future. ... To identify the true causal effects of monetary policy on inflation, it
https://www.rba.gov.au/publications/rdp/2020/2020-01.html
Conclusion
28 Jan 2020
RDP
2020-01
I show that it is therefore crucial to account for the response of monetary policy to credit market conditions when estimating its inflation effects. ... Furthermore, it is important to account for cash rate changes expected by financial market
https://www.rba.gov.au/publications/rdp/2020/2020-01/conclusion.html
Credit Spreads, Monetary Policy and the Price Puzzle
1 Jan 2020
RDP
2020-01
the exchange rate) already before it is measured. This may be a further source of bias for the estimated policy effects in BT. ... I begin by formally showing under which conditions the RR approach suffers from the same omitted variable bias that it aims
https://www.rba.gov.au/publications/rdp/2020/2020-01/full.html
Introduction
28 Jan 2020
RDP
2020-01
the exchange rate) already before it is measured. This may be a further source of bias for the estimated policy effects in BT. ... I begin by formally showing under which conditions the RR approach suffers from the same omitted variable bias that it aims
https://www.rba.gov.au/publications/rdp/2020/2020-01/introduction.html
Non-technical summary for ‘Credit Spreads, Monetary Policy and the Price Puzzle’
1 Jan 2020
RDP
2020-01
To measure the success of the monetary policy intervention, it is therefore important to disentangle the true causal effect of monetary policy on inflation and other macroeconomic indicators from other confounding ... For Australia, the Reserve Bank
https://www.rba.gov.au/publications/rdp/2020/2020-01/non-technical-summary.html
Robustness to Model Misspecification and the GFC Episode
28 Jan 2020
RDP
2020-01
While adding domestic money and credit spreads to the baseline SVAR including the BT shock series removes the price puzzle in the long run, it cannot explain the initial emergence of ... Second, it may also reflect learning by the Bank. As the GFC
https://www.rba.gov.au/publications/rdp/2020/2020-01/robustness-to-model-misspecification-and-the-gfc-episode.html
The Cash Rate Response to Credit Market Conditions
28 Jan 2020
RDP
2020-01
However, I will also show that it implies that the RR ‘shocks’ used by BT are anticipated as financial market participants understand and expect the Bank's response to financial market ... While the Bank occasionally communicates its outlook on the
https://www.rba.gov.au/publications/rdp/2020/2020-01/the-cash-rate-response-to-credit-market-conditions.html
Credit Market Conditions and the Bank's Forecast Errors
28 Jan 2020
RDP
2020-01
Since money and credit market conditions provide additional information about future inflation, it is reasonable to expect this to be the case for other variables that the Bank may target.
https://www.rba.gov.au/publications/rdp/2020/2020-01/credit-market-conditions-and-the-banks-forecast-errors.html
Biased Romer and Romer Estimates – The Role of Credit Spreads
28 Jan 2020
RDP
2020-01
Assume that Z. t. is a determinant of inflation as before (see Equation (1)), but it does not inform the Bank's central inflation forecast, that is. ... But going back to the GFC episode may offer some support for this and provide some intuition for how
https://www.rba.gov.au/publications/rdp/2020/2020-01/biased-romer-and-romer-estimates-the-role-of-credit-spreads.html
The Effects of Monetary Policy Shocks on Inflation, Unemployment and Output
28 Jan 2020
RDP
2020-01
But it is not only large cash rate changes for which the size and direction of the shock differs between the two models. ... These results suggest that purging cash rate changes only of the Bank's forecasts and financial market expectations does not
https://www.rba.gov.au/publications/rdp/2020/2020-01/the-effects-of-monetary-policy-shocks-on-inflation-unemployment-and-output.html