Work

Substitutability between Balance Sheet Reductions and Policy Rate Hikes: Some Illustrations and a Discussion

Year: 2022

Type: article

Abstract: This note explores the substitutability between policy rate hikes and reductions in the size of the Federal Reserve's balance sheet for the removal of policy accommodation. We do so using a version of the FRB/US model augmented to incorporate the effects of changes in the Federal Reserve's asset holdings on term premiums.

Source: FEDS Notes

DOI: 10.17016/2380-7172.3147

Authors: Edmund Crawley, Etienne Gagnon, James Hebden, James Trevino

Institutions: Federal Reserve, Federal Reserve Board of Governors

Language: English

Topic: Monetary Policy and Economic Impact

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: hybrid

OpenAlex ID: W4281608303

FWCI: 11.06

Cites: 13

Cited by: 32

Related to: 10