The study of interest rate models and term structure analysis is central to understanding financial markets, underpinning the valuation of fixed income securities, derivatives, and risk management ...

Financial markets—specifically derivatives—contain information about the range of probable future short-term interest rates. The information from this statistical distribution can help measure the ...

Empirical monetary policy shocks (EMPS) contain information about monetary policy both today and in the future. We define the term structure of monetary policy news as the marginal impact of an EMPS ...

Discover how biased expectations theory impacts interest rates by incorporating investor preferences and risks, beyond just ...

After a prolonged decline, U.S. inflation-adjusted interest rates have increased somewhat since the pandemic—possibly implying a higher new normal. As central banks attempt to tame the post-pandemic ...

For the first time since December 2024, interest rates have been cut, giving borrowers reason for cautious optimism. Savers, however, may want to strongly consider pivoting their approach. The high ...

The Federal Reserve’s most important monetary policy tool is the Fed Funds Interest Rate target. By raising or lowering this benchmark, the Fed hopes to influence the cost of credit throughout the ...