Monetary Policy Independence in an Era of Financial Globalization: What Theory Suggests and the Data in Oceania Say

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dc.contributor.authorGuender, Alfred
dc.date.accessioned2024-07-01T02:10:27Z
dc.date.available2024-07-01T02:10:27Z
dc.date.issued2024
dc.description.abstractThis paper shows that under a floating exchange rate and integrated financial markets an optimizing central bank concerned about price and output stability partly accommodates a change in monetary policy abroad. A positive co-movement between the domestic policy rate and the foreign interest rate does not indicate lack of monetary policy independence but is an outcome of optimal policymaking in an open economy deeply embedded in the global financial architecture. Empirical evidence on overnight interest rate changes in Oceania (New Zealand, Australia) and US federal funds rate changes is consistent with this view.
dc.identifier.citationGuender A (2024). Monetary Policy Independence in an Era of Financial Globalization: What Theory Suggests and the Data in Oceania Say.
dc.identifier.urihttps://hdl.handle.net/10092/107100
dc.rightsAll rights reserved unless otherwise stated
dc.rights.urihttp://hdl.handle.net/10092/17651
dc.subjectPolicy Independence
dc.subjectOptimal Policy Response
dc.subjectCorrelation of Interest Rates
dc.subjectHigh Capital Mobility
dc.subject.anzsrc35 - Commerce, management, tourism and services::3502 - Banking, finance and investment::350207 - International finance
dc.subject.anzsrc35 - Commerce, management, tourism and services::3502 - Banking, finance and investment::350204 - Financial institutions (incl. banking)
dc.subject.anzsrc38 - Economics::3801 - Applied economics::380112 - Macroeconomics (incl. monetary and fiscal theory)
dc.subject.anzsrc38 - Economics::3801 - Applied economics::380107 - Financial economics
dc.titleMonetary Policy Independence in an Era of Financial Globalization: What Theory Suggests and the Data in Oceania Say
dc.typeDiscussion / Working Papers
uc.collegeUC Business School
uc.departmentDepartment of Economics and Finance
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