The Timing of Central Bank Communication: Evidence from China
20 Pages Posted: 12 Feb 2015 Last revised: 15 Feb 2015
Date Written: February 12, 2015
Abstract
In recent years, central bank communication played an important role in monetary policy operations. In this paper, LSTVAR model is used to study the timing of central bank communications as well as the effects of central bank communications and traditional monetary policy tools under different economic status. The results show that monetary policy of China is asymmetric. The state of the economy can be divided into high growth and low growth, and the effectiveness of monetary policy tools will change under different economic status. The central bank should accurately determine the state of the economy and rationally use the various monetary policy tools for better play to the strength of different monetary tools.
Keywords: Central bank communication, monetary policy tools, LSTVAR model
JEL Classification: E52, E58, E43
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