“The Effects of the Bank of Japan’s Zero Interest Rate Commitment and Quantitative Monetary Easing on the Yield Curve: A Macro-Finance Approach”, Bank of Japan Working Paper No.05-E-6. Ramey, Garey and Valerie A. Ramey (1995). “Cross-Country Evidence on the Link Between Volatility and Growth”, American Economic Review, 85(5), 1138–1151. Reifschneider, David L., and John C. Williams (2000). “Three Lessons for Monetary Policy in a Low Inflation Era”, Journal of Money, Credit and Banking, 32(4), 936–966. Rajan, Raghuram G. (2005). “Has Financial Development Made the World Riskier?”, in The Greenspan Era: Lessons for the Future, 313–370. Federal Reserve Bank of Kansas City: Kansas City. Shiratsuka, Shigenori (2009). “Size and Composition of the Central Bank Balance Sheet: Revisiting Japan’s Experience of the Quantitative Easing Policy”, Bank of Japan IMES Discussion Paper No. 2009-E-25. Svensson, Lars E. O. (1999). “Price-level Targeting versus Inflation Targeting: A Free Lunch?,” Journal of Money, Credit and Banking, 31(3), 277–295. Taylor, John B. (2007). “Housing and Monetary Policy” in Housing, Housing Finance and Monetary Policy, 463–476. Federal Reserve Bank of Kansas City: Kansas City. Taylor, John B. (2008). “The Costs and Benefits of Deviating from the Systematic Component of Monetary Policy”. Keynote Address at the Federal Reserve Bank of San Francisco Conference on Monetary Policy and Asset Markets, February 22, 2008. Tobin, James (1969). “A General Equilibrium Approach to Monetary Theory”, Journal of Money, Credit and Banking, 1, 15–29. Uhlig, Harald (2005). “What are the Effects of Monetary Policy on Output? Results from an Agnostic Identification Procedure”, Journal of Monetary Economics, 52, 381–419.

And this was an important reason why the Riksbank began to publish its forecasts and other material on which decisions were based early on in the new inflation-targeting regime. Building up confidence in the price stability target as quickly as we actually did would probably have been very difficult if we had not been as open as we were with regard to our work and our decisions. Secondly, openness and clarity are nowadays an important part of monetary policy in itself. According to economic theory, there is a correlation between interest rates with different times to maturity. And expectations of short-term interest rates, which the central bank governs, are important to the longterm interest rates. By influencing expectations of short-term interest rates, a central bank can therefore also indirectly affect interest rates with longer maturities. Greater influence over interestsetting for all maturities – the yield curve – means that the impact of monetary policy is more effective. This is often called conducting monetary policy by “management-of-expectations”. And the best way to do this is to provide good information. A third reason for working to achieve greater openness and clarity “outwards” is that it can help us to work more efficiently within the Riksbank’s walls. And this is an argument I do not think should be underestimated. Openness quite simply increases the incentives for us to do a good job as it makes it easier for others to evaluate how well monetary policy functions. 3  Sveriges Riksbank Act (1983:1385), Chapter 3, Article 3.