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Volume 62, Issue 6

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Is the U.S. Fed Voting Record Informative about Future Monetary Policy?

Horváth, Roman; Šmídková, Kateřina; Zápal, Jan

Year: 2012   Volume: 62   Issue: 6   Pages: 478-484

Abstract: We examine the information content of U.S. Fed voting records under the Greenspan chairmanship. We find that the voting records of FOMC members, as captured by the difference between the average voted-for and actually implemented policy rate, signal the future course of monetary policy. The committee bias, an official statement on how the Fed is leaning in terms of its next interest rate move, is found to improve monetary policy predictability, too. On the other hand, the voting of alternate members, who actively contribute to the discussions at the monetary policy meetings but whose votes do not count for setting the interest rate, does not have predictive power and is more in line with that of the chairman.

JEL classification: D78, E52, E58

Keywords: monetary policy, voting record, transparency

RePEc: http://ideas.repec.org/a/fau/fauart/v62y2012i6p478-484.html

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