In open economy, a choice can be made between two measures of inflation for use as a target variable: CPI inflation or … domestic inflation. This paper considers flexible and strict inflation targeting strategies and explores the circumstances … under which a domestic inflation target is preferred to a CPI inflation target. This is done from the perspectives of the …

. This was a period of very low inflation. The rate of growth in the aggregate price level was occasionally very close to … inflation. The declining prices cannot, however, be explained by lack of demand or any generalized deflationary tendencies … develops a new method for looking at the composition of inflation and illustrating how relative price dynamics interact with …

Monetary policy transmission lags create credibility problems for the inflation-targeting policy maker who acts under …: for the period monetary policy influences output, inflation is predetermined and the best discretionary policy is to …

Both the optimal inflation target and the optimal degree of output stabilization are found to be conditional on the … explicit inflation targeting regime removes inflation bias from monetary policy, but does not remove the trade-off related to … average level of output and output stabilization. In contrast to usual results on inflation targeting, appointing a central …

We use the ten years of experience in inflation-targeting in New Zealand since 1989 to test whether monetary policy … appears to conform to the simple rules that have been recommended for it in the literature. Of the inflation targeting central … Policy Statements is firmly based on targeting the inflation rate in the future we find, using the Bank’s own forecasts, that …

either pricelevel or nominal GDP targeting and compare these regimes to inflation targeting. These interest-rate rules are … domain of attraction of the targeted steady state, volatility of inflation and output and sensitivity to the speed of …