The Federal Reserve Bank of Cleveland on East 6th Street in Cleveland, U.S., on Sunday, April 13, 2014. Photographer: Ron Antonelli/Bloomberg *** Local Caption ***

Eyeing the impact of the Fed’s guidance

Monitoring Desk

Cleveland Fed researchers Wesley Janson and Chengcheng Jia posted a recent study looking at whether the forward guidance provided with the April and June FOMC meetings changed the public’s expectations for the economy and monetary policy.“We find that forward guidance was effective in altering the public’s expectations about future policy rates if it was accompanied by a Summary of Economic Projections (SEP) but not expectations about economic fundamentals.”

“The publication of the SEP allowed the public to get more quantitative information about the likely path of future monetary policy in addition to the qualitative information given in the post-meeting statements.”

Courtesy: Axios

Posted in