Interest Rate Prediction with Taylor Rule

Taylor interest rate and Monetary Conditions Index

Sources of exchange rate fluctuations with Taylor rule fundamentals

a r t i c l e i n f o This paper investigates the sources of exchange rate fluctuations when monetary policy follows a Taylor rule interest rate reaction function. We first present a simple dynamic exchange rate model with Taylor rule fundamentals which is triangular in the long-run impacts of shocks to the output market, the interest rate differential, and the Taylor rule. We then proceed to a...

The Taylor rule and interest rates in the EMU area *

We demonstrate that average interest rates in the EMU countries in 1990–98, with the exception of the period of exchange market turmoil in 1992–93, moved very closely with average output gaps and inflation as suggested by the Taylor rule.  2000 Elsevier Science S.A. All rights reserved.

Making Interest-free Banking System More Efficient with Regards to Interest Rate

Estimating a Taylor Rule for New Zealand with a time-varying neutral real rate

1 2 Many critics of the Taylor rule claim that it is inferior to inflation forecast based (IFB) rules because it is not forward-looking, is not aggressive enough, and because of uncertainty surrounding the output gap. Nevertheless, the Taylor rule serves a constructive purpose because it abstracts from the Bank’s macroeconomic model, FPS, and its performance is robust across various economic mo...