Inflation and Real Interest Rates on Assets with Different Risk Characteristics
نویسندگان
چکیده
منابع مشابه
Why Are Inflation and Real Interest Rates So Low? A Mechanism of Low and Floating Real Interest and Inflation Rates
Real interest and inflation rates have been very low in many industrialized countries since the Great Recession. In this paper, a mechanism of low and floating real interest and inflation rates is examined based on the concept a “Nash equilibrium of a Pareto inefficient path” and the law of motion for trend inflation. I show that, because the link between the marginal product of capital and the...
متن کاملA market based approach to inflation expectations, risk premia and real interest rates ¬リニ
In this paper we approach the inflation expectations and the real interest rate by using the information contained in the yield curve. We decompose nominal interest rates into real risk-free rates, inflation expectations and risk premia using an affine model that takes as factors the observed inflation rate and the parameters generated in the zero yield curve estimation. Under this approach we ...
متن کاملInterest Rates, ECB Communication and Inflation Expectations
Guiding and anchoring inflation expectations of the public are key tasks of modern central banks. In this paper we investigate how the European Central Bank (ECB) influences inflation expectations of professional forecasters. We argue that it is a good sign that interest rate changes as such are not significant in explaining inflation expectations: The ECB has been able to prepare professional ...
متن کاملReal Interest Rates, Expected Inflation, and Real Estate Returns: A Comparison of the U.S. and Canada
In the United States, but not in Canada, nominal interest on residential housing mortgages is a deductible expense for the personal income tax. This suggests that changes in nominal interest rates could conceivably have differing impacts on real estate values in the two countries. The inflation component of nominal interest should have a negative impact on Canadian real estate, but its effect s...
متن کاملHedging~interest Rate Risk with Options on Average Interest Rates
MARCH 1995 Hedging interest rate risk has become one of the most common and important types of a financial manager's risk management activities. A classic example is for a firm to hedge its cost of funds by using an interest rate cap to place an upper bound on its borrowing costs. The hedge typically consists of a sequence of individual call options on the interest rate, with option expiration ...
متن کاملذخیره در منابع من
با ذخیره ی این منبع در منابع من، دسترسی به آن را برای استفاده های بعدی آسان تر کنید
ژورنال
عنوان ژورنال: The Journal of Finance
سال: 1984
ISSN: 0022-1082
DOI: 10.2307/2327929