Jackson Hole Annual Meeting Report: Inflation has a greater impact on the market after interest rate hikes

BlockBeats news, on August 24, a report published at the Jackson Hole Annual Meeting stated that it was only after the Fed launched a rate hike cycle in 2022 that the bond market became more sensitive to inflation data. This means that the public does not understand the (monetary policy) strategy before the FOMC rate hike. "Consistent with the shift in perceived policy responses, event studies show that interest rates are significantly more sensitive to surprises in inflation data after rate hikes. The increase in perceived inflation response may help the transmission of monetary policy to the real economy and improve the Fed's inflation-unemployment trade-off," the authors of the paper (Michael Bauer, Carolin Pflueger, and Adi Sunderam) wrote. (Jinshi)