The standard empirical test of whether the Federal Reserve can influence interest rates is to regress interest rates on current and past (actual or unexpected) values of money growth. This literature generally finds little support for the view that the Fed can influence interest rates, except...

This paper presents evidence that throughout the 1973-85 period the Federal Reserve systematically used certain types of discount rate announcements to signal changes in its policy instrument, the Federal funds rate. Market participants understood the signals contained in discount rate...

Considerable attention has been devoted to the reaction of interest rates, foreign exchange rates, and stock prices to unanticipated money growth revealed by the weekly MI money stock announcement. Numerous articles have attempted to explain why nominal interest rates rise following the...

What determines the relationship between yield and maturity (the yield curve) in the money market? A resurgence of interest in this question in recent years has resulted in a substantial body of new research. The focus of much of the research has been on tests of the “expectations theory.”...

On October 6, 1979 the Federal Reserve, in an effort to improve monetary control, changed its operating procedures to give greater emphasis to managing the growth of bank reserves. Some movements in the federal funds rate under the new procedures were an automatic response to deviations of the...

In the late 1970s the money stock was growing at a faster rate than desired, the rate of inflation was accelerating, and the dollar was steadily depreciating in the foreign exchange markets. In an attempt to reverse these developments the Federal Reserve on October 6, 1979 announced several...

The purpose of this paper is to explore the reasons underlying the variable and sometimes very large differentials between United States Treasury bill rates and private sector U.S. money market rates of comparable maturity

Observed differentials among yield series for different types of long-term instruments -- U.S. government bonds, municipal bonds, corporate bonds and residential mortgages -- vary considerably over time

Interest rates have reacted strongly to the monthly employment report in recent years. The authors document the reaction of rates to the report and provide evidence that it has been stronger since the mid-1980s than in earlier years. Evidently the report now has greater impact than formerly on...

Has the introduction of interest-bearing NOW accounts altered the nature of M1? That monetary aggregate, of course, is intended to measure purely transactions balances as typified by conventional checking accounts. But some observers think that consumers are using the NOW component of M1 as...