Inflation Targeting: Some Extensions
1997 (English)Report (Other academic)
Previous analysis of the implementation of inflation targeting is extended to monetary policy responses to different shocks, consequences of model uncertainty, effects of interest rate smoothing and stabilization, a comparison with nominal GDP targeting, and implications of forward-looking behavior. Model uncertainty, output stabilization, and interest rate stabilization or smoothing all call for a more gradual adjustment of the conditional inflation forecast toward the inflation target. The conditional inflation forecast is the natural intermediate target during inflation targeting.
Place, publisher, year, edition, pages
Stockholm: IIES , 1997. , 44 p.
Seminar Paper / Institute for International Economic Studies, Stockholm University, ISSN 0347-8769 ; 625
IdentifiersURN: urn:nbn:se:su:diva-40988OAI: oai:DiVA.org:su-40988DiVA: diva2:327673