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Threats to Central Bank Independence: High-Frequency Identification with Twitter / Francesco Bianchi, Thilo Kind, Howard Kung.
- Format:
- Book
- Author/Creator:
- Bianchi, Francesco.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w26308.
- NBER working paper series no. w26308
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Other Title:
- Threats to Central Bank Independence
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2019.
- Summary:
- A high-frequency approach is used to analyze the effects of President Trump's tweets that criticize the Federal Reserve on financial markets. Identification exploits a short time window around the precise timestamp for each tweet. The average effect on the expected fed funds rate is negative and statistically significant, with the magnitude growing by horizon. The tweets also lead to an increase in stock prices and to a decrease in long-term U.S. Treasury yields. VAR evidence shows that the tweets had an important impact on actual monetary policy, the stock market, bond premia, and the macroeconomy.
- Notes:
- Print version record
- September 2019.
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