This paper is a study of the intervention policy of the Swedish central bank using daily intervention data for the late 1980s. In contrast to the first generation of target zone models, we find that the interventions occur all over the exchange rate band and almost every day. Based on this...

This paper analyzes how bond option prices are affected by different types of monetary policy. Analytical results from a general equilibrium model with sticky wages show that employment or output targeting typically give lower bond option prices than inflation targeting. -- inflation targeting ;...