The effect of information about inflation expectations on interest rate expectations

Last registered on September 08, 2025
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Pre-Trial

Trial Information

General Information

Title
The effect of information about inflation expectations on interest rate expectations
RCT ID
AEARCTR-0016610
Initial registration date
September 04, 2025

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
September 08, 2025, 8:06 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Country
United States of America
Region

Primary Investigator

Name
Damjan Pfajfar
Affiliation
Federal Reserve Bank of Cleveland
Contact Primary Investigator

Other Primary Investigator(s)

PI Name
Fabian Winkler
PI Affiliation
Board of Governors of the Federal Reserve System
Contact Investigator

Additional Trial Information

Status
On going
Start date
2025-08-22
End date
2025-09-30
Keywords
Behavior
Additional Keywords
interest rate expectations, inflation expectations
JEL code(s)
D12, E52, E58
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
Existing surveys do not ask for quantitative interest rate expectations and focus mostly on savings rates or interest rates in general. In the first part of this study, we ask households directly about their quantitative one-year ahead expectations for various interest rates, including for the federal funds rate, mortgage rates, savings rates and credit card interest rates. We document that households with higher inflation expectations tend to report higher interest rate expectations, consistent with a Fisher effect and monetary policy tightening in response to inflation. In the second part of this study, we design a randomized control trial that would test the above prediction. We expose households in the Daily Survey of Consumers, conducted by the Federal Reserve Bank of Cleveland, to different information treatments that convey information about inflation forecasts. Then we plan to look at the response of inflation expectations and interest rate expectations to these information treatments. Further, we study the causal effect of the increase of inflation expectations on interest rate expectations.
External Link(s)

Registration Citation

Citation
Pfajfar, Damjan and Fabian Winkler. 2025. "The effect of information about inflation expectations on interest rate expectations." AEA RCT Registry. September 08. https://doi.org/10.1257/rct.16610-1.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
We expose households in the Daily Survey of Consumers, conducted by the Federal Reserve Bank of Cleveland, to different information treatments that convey information about inflation forecasts: control group, mean forecast, forecast with low bands, forecast with high bands, and placebo group.
Intervention (Hidden)
We expose households in the Daily Survey of Consumers, conducted by the Federal Reserve Bank of Cleveland, to different information treatments that convey information about inflation forecasts: control group, mean forecast, forecast with low bands, forecast with high bands, and placebo group.
Intervention Start Date
2025-08-22
Intervention End Date
2025-09-30

Primary Outcomes

Primary Outcomes (end points)
posterior inflation expectations, posterior interest rate expectations, elasticity between interest rate and inflation expectations.
Primary Outcomes (explanation)
elasticity between interest rate and inflation expectations: Estimating a Taylor-rule-type regression, where we instrument posterior inflation expectations with a typical first stage regression (prior, treatment dummies, and their interaction).

Secondary Outcomes

Secondary Outcomes (end points)
Heterogeneity of responses across different socioeconomic groups.
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
After eliciting prior inflation and interest rate expectations, we expose households to different information treatments that covey information about inflation forecasts: control group, mean forecast, forecast with low bands, forecast with high bands, and placebo group. After the intervention, we elicit posterior inflation and interest rate expectations.
Experimental Design Details
After eliciting prior inflation and interest rate expectations, we expose households to different information treatments that covey information about inflation forecasts: control group, mean forecast, forecast with low bands, forecast with high bands, and placebo group. After the intervention, we elicit posterior inflation and interest rate expectations.
Randomization Method
Randomization conducted by survey provider (Qualtrics).
Randomization Unit
individual consumer
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
No clusters, 5 treatment arms
Sample size: planned number of observations
We plan to collect 3,000-4,000 observations
Sample size (or number of clusters) by treatment arms
each treatment arm will have approximately 1/5 of observations.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
Advarra
IRB Approval Date
2022-01-17
IRB Approval Number
Original approval: Pro00060042; Modification approval: MOD02687629
Analysis Plan

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials