This paper evaluates a class of simple policy rules that feed back from expected values of future inflation--inflation forecast-based rules. The rules are assessed by how well they perform when the economy is buffeted by a combination of shocks, whose distribution is drawn from the Bank of...

In the past decade or so, a number of central banks have purchased assets financed by the creation of central bank reserves as a tool for loosening monetary policy – a policy often known as ‘quantitative easing' or ‘QE'. The first half of the paper reviews the international evidence on the...

The recovery from the recession after the financial crisis, in both the UK and the US, has been very slow compared with other similar events in history. During the period before the financial crash and afterwards, monetary policy deviated from the very effeective rules-based approach of the...