Monetary policy in the open macroeconomy
When the United States’ Federal Open Market Committee (FOMC) meets, they publish that meeting’s minutes. With bated breath, the world waits for these minutes to arrive on the internet or to be summarized in various news sources elucidating why any change or no change to the federal funds rate target was made. Why should the world await this news so intensely? In Chapter 11, the domestic effects on various markets from a monetary shock were discussed. This chapter focuses on monetary policy effects, the exchange rate, and connections between economies.