Discussion of Thomas Laubach and John C. Williams, “Measuring the Natural Interest Rate,” American Economic Association Annual Meeting, Atlanta, Jan 4-6, 2002.

New briefing paper: “Sweden and the Euro,” Jan 2002.

New paper: “The Inflation Forecast and the Loss Function,” Version 1.1, Dec 2001.

New paper: “Inflation Targeting: Should It Be Modeled as an Instrument Rule or a Targeting Rule?” Dec 2001, European Economic Review, forthcoming.

New revision: “What Is Wrong with Taylor Rules? Using Judgment in Monetary Policy through Targeting Rules,” Version 2.05, November 2001.

Old paper made available: “Term, Inflation, and Foreign Exchange Risk Premia: A Unified Treatment,” NBER Working Paper No. 4544, November 1993. (IIES Seminar Paper No. 548). Paper.

Abstract
The paper reviews the theoretical foundations of the use of forward interest rates to infer expected future rates of interest, inflation, currency depreciation and inflation differentials. Forward rates are related to these expected future variables via combinations of term, inflation and foreign exchange risk premia. A unified derivation, discussion and comparison of these premia is provided under both general and specific assumptions, as well as some comments on empirical estimation.