On This PageVol. 22, No. 3

Real-time Taylor rules and the federal funds futures market
Last Updated: 09/04/98
This article compares movements in the federal funds rate from 1987 through 1997 with predictions from the federal funds futures market and a Taylor rule using unemployment and core CPI data. Although a Taylor rule using revised data does about as well as the futures market predictions, the best real-time predictions would have produced forecast errors about 50 percent larger than the futures data.