Expectations for the MPC chair and interest rate persistence.

This paper examines how the public's expectations for the chair of the monetary policy committee influence policy outcomes. We show that the expectation that the chair will propose their ideal policy at the meeting can lead a majority of the committee to reject the policy change. The result suggests that the expectation of the chair's agenda setting is a determinant of interest rate persistence. • We examine an agenda-setting model of the monetary policy committee. • Assume that the committee members are relatively hawkish. • Consider expectations that the chair will propose their ideal policy at the meeting. • We show that such expectations can be a cause of persistent interest rates. [ABSTRACT FROM AUTHOR]