Report
Monetary tightening cycles and the predictability of economic activity
Abstract: Eleven of fourteen monetary tightening cycles since 1955 were followed by increases in unemployment; three were not. The term spread at the end of these cycles discriminates almost perfectly between subsequent outcomes, but levels of nominal or real interest rates, as well as other interest rate spreads, generally do not.
Keywords: Unemployment; Interest rates; Business cycles; Monetary policy;
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Bibliographic Information
Provider: Federal Reserve Bank of New York
Part of Series: Staff Reports
Publication Date: 2009
Number: 397