This paper investigates empirically how the reaction of monetary policy to exchange rate has changed after the adoption of inflation targeting regime in three East Asian countries. Using a structural VAR and single equation methods, this study shows that the reactions of monetary policy to...

This paper investigates the transmission mechanism of monetary policy and inflation targeting in a small open-economy by using backward-looking of aggregate supply (AS) and aggregate demand (AD) framework. Since September 1998 until July 2005, Malaysia has implemented a currency pegged to the...

After more than two decades of inflation targeting in the world, it is important to evaluate if the adoption of this regime in a relevant developing country contributed to the creation of a better environment for the process of entrepreneurs' expectations formation. Brazil is part of an...

Inflation Targeting (IT) can be expected to play a role in structurally reducing nominal interest rates, by lowering a country’s inflation expectations and risk premium. Relying on a panel of 52 advanced and emerging economies over the 1975-2009 years, we carry out a formal investigation of...

Introduction of inflation targeting has global effects on dynamic of prices and economic growth. In case of a developing country with an increasing remonetization since 2007 – 2008 and modest growing later than 2009 it’s important to assess the adoption of a new regime and how it helps to...

With the adoption of the Bangko Sentral ng Pilipinas (BSP) of the Inflation Targeting (IT) framework in 2002, average inflation went down in the past decade from historical average. However, the BSP’s inflation targets were breached several times since 2002. Against this backdrop, this paper...

The paper shows the advantages and handicaps of implementing an inflation target (IT) regime, from a Post-Keynesian and, thus, an institutional stance. It is Post-Keynesian as long as it does not perceive any benefit in the mainstream split between monetary and fiscal policies. And it is...

Some countries may face choice between targeting inflation independently and entering a monetary union that targets inflation. This paper shows that the choice of a country in favour of monetary union may be motivated by asymmetrical supply shocks. The demand shocks are neutralised under these...

This paper develops an efficient approach to model and forecast time-series data with an unknown number of change-points. Using a conjugate prior and conditional on time-invariant parameters, the predictive density and the posterior distribution of the change-points have closed forms. The...

Some emerging economies have recently experienced large government surpluses and accelerating foreign exchange reserve accumulation far in excess of what would be implied by the literature on optimal reserves. China in particular has repeatedly stressed that there may be an upper limit to how...