Author (Your Name)

Luying YangFollow

Date of Award


Document Type

Honors Thesis (Open Access)


Colby College. Economics Dept.


David Findlay

Second Advisor

Rob Lester


Previous research has confirmed a positive relationship between the slope of the yield spread and future economic growth. Since the start of the Great Recession, a number of developed economies have hit the zero lower bound and adopted unconventional monetary policies such as large-scale bond/asset purchase programs and negative interest rate policies. This paper finds that the yield spread’s predictive power generally deteriorates after the central bank adopts its first bond purchase program. However, there is no general pattern of how these unconventional monetary policies impact the yield spread’s forecasting ability across countries.


Monetary policy, Yield spread, Negative Interest Rate Policy, Unconventional monetary policy

Available for download on Monday, July 10, 2023