Government exchange rate regime choice is constrained by both political and economic factors. One political factor is the role of special interests: the larger the tradable sectors exposed to international competition, the less likely is the maintenance of a fixed exchange rate regime. Another...

In practice, the Federal Open Market Committee (FOMC) believes that it has a broad mission to achieve three main goals. These are to: ? Maintain a low inflation environment. ? Stabilize the real economy. ? Underpin the soundness of the financial system. There is little controversy over these...

Two empirical relationships about the effect of oil prices on the U.S. economy are well accepted. The first is that while oil price increases lowered real GDP growth in the 1970?s, since then changes in oil prices have had no significant effect on U.S. economic activity. Second, while oil price...

In its quest to understand and anticipate Federal Reserve behavior, Wall Street economists ad journalists have mined the activity in labor markets to help foretell inflationary price pressures. Earlier during the current expansion, journalists and many academics viewed the low rate of...