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GOVERNMENT BOND YIELDS AT THE EFFECTIVE LOWER BOUND: INTERNATIONAL EVIDENCE
Author(s) -
Lombardi Domenico,
Siklos Pierre L.,
St. Amand Samantha
Publication year - 2019
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/coep.12238
Subject(s) - government bond , monetary policy , monetary economics , economics , interest rate , central bank , yield (engineering) , empirical evidence , bond , government (linguistics) , quantitative easing , international economics , finance , philosophy , linguistics , materials science , epistemology , metallurgy
Empirical evidence on the potential impact of central bank policies on government bond yields at the effective lower bound ( ELB ) is presented for nine economies. We quantify the content of central bank communications and consider international policy spillovers. Yields at the medium‐to‐longer end of the yield curve remain responsive to news for a few years after the ELB is reached. Yields become more sensitive to the content central bank communication at the ELB . Our results provide further evidence that central bank communication is an important element of monetary policy making when the interest rate tool loses efficacy. ( JEL E52, E58, G12, F42)