Monetary Policy is Not Always Systematic and Data-Driven: Evidence from the Yield Curve

Does monetary policy react systematically to macroeconomic innovations in emerging and low-income countries? And do such systematic responses vary across regimes? In a sample of 16 countries – operating under various regimes we find that decisions, as expressed yield curve movements, almost all countries. The speed strength reactions are not identical countries, however, but reflect the regime. While evidence primacy price stability objective inflation-targeting links inflation output gap generally weaker less money-targeting multiple-objective