Abstract
I study the impact of various measures of monetary policy announcements on household expectations between 2013 and 2021. I approach this through an event study and a local projections methodology that exploits the microdata found in the Survey of Consumer Expectations as well as the timing of the FOMC meeting announcements in this time period. Across the different measures of monetary policy, I find that, on average, a lack of a tightening announcement decreases household expectations of the one-year ahead path for interest rates on savings accounts by 3.1%, while tightening announcements increase one-year inflation expectations by up to 3.6% and decrease their one-year ahead home price growth between 1.4 - 2.0%. This finding is corroborated by the local projections in a one year ahead time horizon and emphasizes the need for the central bank to improve on the timing of its communication strategy. Expectations of other variables such as household spending and various commodity prices are scarcely affected, results which stand in contrast to the literature in laboratory settings which find strong effects on information treatments about policy changes.
