DP8160 What Drives the European Central Bank's Interest-Rate Changes?
|Author(s):||Morten Aastrup, Henrik Jensen|
|Publication Date:||December 2010|
|Keyword(s):||ECB monetary policy, Taylor principle, Taylor rules|
|Programme Areas:||International Macroeconomics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=8160|
We show that the ECB's interest rate changes during 1999-2010 have been mainly driven by changes in economic activity in the Euro area. Changes in actual or expected future HICP inflation play a minor, if any, role.