In 2023, an article in the Wall Street Journal had the headline Bond Volatility Jumps to Highest

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In 2023, an article in the Wall Street Journal had the headline “Bond Volatility Jumps to Highest Since 2008 Financial Crisis.”

a. What does the article mean by “volatility” in bonds? Is avoiding volatility in the bond market part of the Fed’s dual mandate?

b. Should the Fed be concerned about bond market volatility? Briefly explain.

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Macroeconomics

ISBN: 9780138102494

9th Edition

Authors: Glenn Hubbard, Anthony Patrick O Brien

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