Working Paper: CEPR ID: DP8160
Authors: Henrik Jensen; Morten Aastrup
Abstract: We show that the ECB's interest rate changes during 1999-2010 have been mainly driven by changes in economic activity in the Euro area. Changes in actual or expected future HICP inflation play a minor, if any, role.
Keywords: ECB; Monetary Policy; Taylor Principle; Taylor Rules
JEL Codes: E43; E58
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| economic activity (unemployment) (E24) | ECB interest rate changes (E52) |
| inflation (HICP) (E31) | ECB interest rate changes (E52) |
| current output changes (D57) | ECB interest rate changes (E52) |