Dear Professor Pfeifer,

After bayesian estimation of the model, I got negative value of parameter **rhoy** (e.g. -0.05) in Taylor Rule which is written as

exp( R ) = R_ss^(1 - rhoR )

* (exp(R(-1)))^rhoR

* (exp(dp)/pi_ss)^( rhopi*(1-rhoR) )

* (exp(y)/exp(y(-1)))^( rhoy*(1-rhoR) )

* (1+e_R);

I was wondering if it’s OK to accept this result as I seldom see negative value of this parameter in other papers, and how should I interpret this ?

Thank you for your time.

Best regards