About this work
How bond yields react to unexpectedly strong data can reveal whether markets trust central bank guidance. Robin Brooks and Jonathan Fortun revisit turning points in the 2013 taper tantrum, when positive surprises increasingly pushed US rates higher. Their January 2021 comparison uses that experience to assess the credibility of the Federal Reserve’s new average inflation targeting framework.
Abstract
How bond yields react to unexpectedly strong data can reveal whether markets trust central bank guidance. Robin Brooks and Jonathan Fortun revisit turning points in the 2013 taper tantrum, when positive surprises increasingly pushed US rates higher. Their January 2021 comparison uses that experience to assess the credibility of the Federal Reserve’s new average inflation targeting framework.
Cite this work
Robin Brooks, Jonathan Fortun (2021). GMV: Lessons from the 2013 Taper Tantrum. Institute of International Finance.