Welcome to "BOJ from Home." Through this online tour, we offer you a 3-D/virtual reality (VR) viewing experience as you explore the new tour route of the Bank of Japan's Head Office (designated as an Important Cultural Property).
The interior of the Bank's Main Building can be viewed in 3-D on any PC or mobile device.
You can also enjoy an immersive virtual reality experience using VR goggles or glasses.
The effective lower bound (ELB) on a short term interest rate may not constrain a central bank's capacity to achieve its objectives if unconventional monetary policy (UMP) is powerful enough. We formalize this 'irrelevance hypothesis' using a dynamic stochastic general equilibrium model with UMP and test it empirically for the United States and Japan using a structural vector autoregressive model that includes variables subject to occasionally binding constraints. The hypothesis is strongly rejected for both countries. However, a comparison of the impulse responses to a monetary policy shock across regimes shows that UMP has had strong delayed effects in each country.
Keywords: Effective lower bound; unconventional monetary policy; structural VAR
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