This paper examines the relationship between macroeconomic objectives of controlling inflation and trade … between the two, as a crawling peg exchange-rate policy can prevent inflation from affecting the performance of the foreign … sector. In practice, trade regime objectives have been linked with inflation-reducing objectives, often to the detriment of …

We argue that the Great Inflation experienced by both the United Kingdom and the United States in the 1970s has an … common doctrine underlying the systematic monetary policy choices in each country. The nonmonetary approach to inflation …

inflation and activity. If policy makers are guided by the welfare criterion of the representative household, globalization … forces also lead monetary policy to be more aggressive with regard to inflation fluctuations but, at the same time, more …

linking interest rates to forecasts of future inflation. Such rules have been found to give rise to aggregate fluctuations due … interest-rate rules whereby the central bank responds to a measure of past inflation. The consensus view that has emerged is … inflation are likely to ensure global stability provided that the coefficient on lagged interest rates is greater than unity …

This paper examines what strategies policymakers have used to both reduce and control inflation. It first outlines why … a consensus has emerged that inflation needs to be controlled. Then it examines four basic strategies: exchange rate … pegging, monetary targeting, inflation targeting, and the just do it' strategy of preemptive monetary policy with no explicit …

This paper shows that it is possible to analyze equilibrium inflation determination without any reference to either … become negligible. Inflation in the cashless limit is shown to be a function of the gap between the natural rate' of interest …-rate rule indicating the tightness of monetary policy. Inflation can be completely stabilized, in principle, by adjusting the …

Previous analysis of the implementation of inflation targeting is extended to monetary policy responses to different … 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 …

Inflation targeting is shown to imply inflation forecast targeting: the central bank's inflation forecast becomes an … explicit intermediate target. Inflation forecast targeting simplifies both implementation and monitoring of monetary policy …. The weight on output stabilization determines how quickly the inflation forecast is adjusted towards the inflation target …

As central bankers intensify their focus on inflation as the primary goal of monetary policy, it becomes increasingly … important to have accurate and reliable measures of changes in the aggregate price level. Measuring inflation is surprisingly … transitory noise and bias. Noise causes short-run changes in measured inflation to inaccurately reflect movements in long …