Passthrough Efficiency in the Fed’s New Monetary Policy Setting

Passthrough Efficiency in the Fed’s New Monetary Policy Setting

Kansas City Federal Reserve Symposium on Designing Resilient Monetary Policy Frameworks for the Future. September
2016

Our objective is to show how the current setting of U.S.-dollar money markets limits the passthrough effectiveness of the Federal Reserve’s monetary policy. We focus on frictions associated with imperfect competition, regulation, infrastructure, and other forms of institutional segmentation within money markets.