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The Case for a Long-Run Inflation Target of Four Percent

Ball, Laurence M. - International Monetary Fund (IMF) - 2014

Many central banks target an inflation rate near two percent. This essay argues that policymakers would do better to … target four percent inflation. A four percent target would ease the constraints on monetary policy arising from the zero … cost, because four percent inflation does not harm an economy significantly. …

Persistent link: https://www.econbiz.de/10010790372

The Macroprudential Framework; Policy Responsiveness and Institutional Arrangements

Lim, Cheng Hoon; Krznar, Ivo; Lipinsky, Fabian; Otani, Akira - International Monetary Fund (IMF) - 2013

This paper gauges if, and how, institutional arrangements are correlated with the use of macroprudential policy instruments. Using data from 39 countries, the paper evaluates policy response time in various types of institutional arrangements for macroprudential policy and finds that the...

Persistent link: https://www.econbiz.de/10011242316

Monetary Transaction Costs and the Term Premium

Espinoza, Raphael A.; Tsomocos, Dimitrios P. - International Monetary Fund (IMF) - 2013

We show that, in a monetary equilibrium, trade and asset prices depend on both the supply of the liquidity by the Central Bank and the liquidity of assets and commodities. As a result, monetary aggregates are informative for the conduct of monetary policy. We also show asset prices are higher in...

Persistent link: https://www.econbiz.de/10010790281

Towards Effective Macroprudential Policy Frameworks; An Assessment of Stylized Institutional Models

Nier, Erlend; Jácome, Luis Ignacio; Osinski, Jacek; … - International Monetary Fund (IMF) - 2011

A number of countries are reviewing their institutional arrangements for financial stability to support the development of a macroprudential policy function. In some cases, this involves a rethink of the appropriate institutional boundaries between central banks and financial regulatory...

Persistent link: https://www.econbiz.de/10009369436

Aid Volatility and Dutch Disease; Is there a Role for Macroeconomic Policies?

Tressel, Thierry; Prati, Alessandro - International Monetary Fund (IMF) - 2006

This paper studies how macroeconomic policies can help offset two unintended and undesirable features of foreign aid: its volatility and Dutch disease. We present evidence that aid volatility augments trade balance volatility and that foreign aid, with the important exception of years of adverse...

Persistent link: https://www.econbiz.de/10005768730

Central Bank Boards Around the World; Why Does Membership Size Differ?

Berger, Helge; Lybek, Tonny; Nitsch, Volker - International Monetary Fund (IMF) - 2006

This paper analyzes empirically differences in the size of central bank boards across countries. Defining a board as the body that changes monetary instruments to achieve a specified target, we discuss the possible determinants of a board's size. The empirical relevance of these factors is...

Persistent link: https://www.econbiz.de/10005768852

Central Bank Quasi-Fiscal Losses and High Inflation in Zimbabwe: A Note

Muñoz, Sònia - International Monetary Fund (IMF) - 2007

securities, they contributed to the four-digit inflation reached in 2006. The remedy for the current situation is clearly to …

Persistent link: https://www.econbiz.de/10005769073

Any Link Between Legal Central Bank Independence and Inflation? Evidence From Latin America and the Caribbean

Jácome, Luis Ignacio; Vázquez, Francisco F. - International Monetary Fund (IMF) - 2005

panel regressions, we find a negative relationship between legal central bank independence (CBI) and inflation. This result … holds for three alternative measures of CBI and after controlling for international inflation, banking crises, and exchange … fails, however, to find a causal relationship running from CBI to inflation. …

Persistent link: https://www.econbiz.de/10005769257

Central Bank Financial Strength and Policy Performance; An Econometric Evaluation

Stella, Peter; Klueh, Ulrich H. - International Monetary Fund (IMF) - 2008

particular inflation. The paper's major finding is that there indeed is a negative relationship between central bank financial … strength and inflation outcomes. This relationship appears to be robust to the choice of alternative country samples, control …

Persistent link: https://www.econbiz.de/10005599357

Issues in Central Bank Finance and Independence

Lönnberg, Åke; Stella, Peter - International Monetary Fund (IMF) - 2008

Conventional economic policy models focus only on selected elements of the central bank balance sheet, in particular monetary liabilities and sometimes foreign reserves. The canonical model of an "independent" central bank assumes that it chooses money (or an interest rate), unconstrained by a...

Persistent link: https://www.econbiz.de/10005604806