František Brázdik, Karel Musil, Stanislav Tvrz
In response to the 2008 financial crisis, when policy rates hit their lower bound, central banks adopted unconventional policies to meet their announced targets. These policies can either directly target interest rates or the quantities of assets. Taking into account the specific features of the Czech economy, this paper presents an extension of the CNB’s core projection model for long-term assets and yield curve control measures. This extension demonstrates the ability of the CNB to consider and assess various unconventional policies within its analytical framework.
JEL codes: E32, E37, E43, E58
Keywords: DSGE models, inflation targeting, quantitative easing, unconventional monetary policy, yield curve
Issued: August 2023
Download: CNB WP No. 8/2023 (pdf, 5.2 MB)