Effectiveness of Monetary Policy Communication in Indonesia and Thailand

Download or read book Effectiveness of Monetary Policy Communication in Indonesia and Thailand written by Sahminan Sahminan and published by . This book was released on 2008 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper we investigate the effectiveness of Bank Indonesia's and Bank of Thailand's monetary policy communication. We focus on two channels of communication: monetary policy statements, and inter-meeting statements. Although the structure of Bank Indonesia's and Bank of Thailand's monetary policy statements have some differences, most of the statements contain policy inclination. In addition, during inter-meeting periods, members of their board of governors often convey statements that contain policy inclination. Our empirical results show that to some extent Bank Indonesia's and Bank of Thailand's monetary policy statements and inter-meeting statements move short-term interest rates effectively. We find that there is asymmetry in the effects of the statements, that is, the statements with loose policy inclination tend to be more effective relative to the statements with tight policy inclination.