Is inflation targeting an appropriate framework for monetary policy? Experience from the inflation-targeting countries … countries are optimistic about inflation targeting as a monetary-policy framework. South Africa is also following this trend … shows that inflation targeting is not a universal remedy to modern economic ills -- there is an emerging danger of assigning …

to model and shock misperceptions, and parameter uncertainty. Targeting inflation in both consumer and intermediate goods …

alternates between periods of deflation coupled with low output and periods of high economic activity with excessive inflation …. More generally, initial beliefs that are arbitrarily close to the inflation target equilibrium can result in complex … helps stabilize expectations around the inflation target equilibrium. …

Most macroeconomic models for monetary policy analysis are approximated around a zero-inflation steady state, but most … central banks target inflation at a rate of about 2 percent. Many economists have recently proposed even higher inflation … importance of appropriately accounting for a low, positive trend inflation rate for the conduct of monetary policy. We first …

stabilizing inflation expectations. This paper argues that this reasoning does not necessarily apply to East Asia, as the nominal … exchange rate pegging policies of these economies are not the explanation for their low inflation. On the contrary, since 1985 …, those economies whose currencies have appreciated less against the U.S. dollar have tended to experience higher inflation …

variations over time in the central bank's inflation target. We derive a closed-form solution for the model, and analyze its … monetary policies and inflation persistence. In particular, we employ the model to illustrate and assess the critique that …

restraining force on inflation going forward. …

One measure of a successful monetary policy is its ability to anchor expectations about future inflation rates … crisis on inflation expectations were largely temporary in the United States, but longer-lasting in the United Kingdom. That … is surprising because the United Kingdom had a formal inflation target during this period. Expectations may have been …

1980’s. In particular, inflation persistence has declined sharply. The paper demonstrates that this decline is consistent …) the central bank more aggressively responds to inflation. …