RDP 2006-05: Optimal Monetary Policy with Real-time Signal Extraction from the Bond Market
Equation (A8)
A
1
=
[
ρ
0
0
0
0
0
0
0
0
0
0
0
1
0
0
0
1
0
0
0
0
0
1
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
−
1
0
0
0
0
−
μ
y
b
0
0
0
0
0
1
0
κ
1
+
φ
(
φ
+
γ
)
κ
η
(
1
−
γ
)
(
φ
+
γ
)
−
μ
π
b
0
0
0
0
−
κ
(
φ
+
γ
)
1
]
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