Deciphering Fedspeak: The Information Content of FOMC Meetings
43 Pages Posted: 25 Mar 2017
Date Written: March 23, 2017
We present a new approach to quantify the economic and policy content of the Federal Reserve communications by dissecting the Federal Open Market Committee (FOMC) meeting minutes into eight distinct economic topics. We examine the informativeness of the Fed's discussion of each of these topics for the stock market and for interest rates. The market finds the Fed's discussion of its policy stance, inflation and employment to be the most informative and its discussion of topics such as trade, consumption and investment are not informative.
JEL Classification: G18, G28, E58
Suggested Citation: Suggested Citation