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- Title
Anticipation of monetary policy in UK financial markets.
- Authors
Lildholdt, Peter; Wetherilt, Anne Vila
- Abstract
The article reports on monetary policy in UK financial markets. Monetary policy directly affects the shortest interest rates in the market. But if market participants are forward-looking, then their expectations of future policy actions, and hence future short-term interest rates, will affect longer-term rates. This paper examines whether the ability of UK market interest rates to predict future policy rate changes has changed markedly over the period 1975-2003. It starts by reviewing the theoretical ideas supporting monetary policy predictability.
- Subjects
UNITED Kingdom; ECONOMIC policy; FISCAL policy; FINANCIAL markets; MONETARY policy; INTEREST rate risk
- Publication
Bank of England Quarterly Bulletin, 2004, Vol 44, Issue 4, p465
- ISSN
0005-5166
- Publication type
Article