What Drives the European Central Bank's Interest-Rate Changes?

15 Pages Posted: 2 Jan 2011  

Henrik Jensen

University of Copenhagen - Department of Economics; Centre for Economic Policy Research (CEPR)

Morten Aastrup

University of Copenhagen - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: November 1, 2010

Abstract

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.

Keywords: ECB Monetary Policy, Taylor Rules, Taylor Principle

JEL Classification: E43, E58

Suggested Citation

Jensen, Henrik and Aastrup, Morten, What Drives the European Central Bank's Interest-Rate Changes? (November 1, 2010). Available at SSRN: https://ssrn.com/abstract=1733546 or http://dx.doi.org/10.2139/ssrn.1733546

Henrik Jensen (Contact Author)

Centre for Economic Policy Research (CEPR)

77 Bastwick Street
London, EC1V 3PZ
United Kingdom

University of Copenhagen - Department of Economics ( email )

Øster Farimagsgade 5
Bygning 26
1353 Copenhagen K.
Denmark
+45 35 323 043 (Phone)
+45 35 323 000 (Fax)

HOME PAGE: http://hjeconomics.dk

Morten Aastrup

University of Copenhagen - Department of Economics

Øster Farimagsgade 5
Bygning 26
1353 Copenhagen K.
Denmark

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