Policymakers' votes and predictability of monetary policy

This paper provides empirical evidence in favor of prompter and more detailed release of Monetary Policy Council's voting records, not published by National Bank of Poland before subsequent MPC meeting. The study shows that voting records, if they were available, could improve predictability of upcoming policy decisions. They reveal strong and robust predictive content as a supplementary factor after controlling for MPC policy bias and responses to inflation, real activity, exchange rates and financial market information. The voting patterns contain information not embedded in the market expectations of future policy, as revealed by the spreads and moves in the market interest rates, and even explicit forecasts of the next policy decision, made by market analysts in Reuters surveys before each policymaking meeting. Moreover, the direction of dissent explains the direction of private sector forecast bias. These findings are based on real-time data and voting patterns only, without knowledge of policymakers' names attached to each vote.