The objective of this paper isto investigate the impact of inflation targeting strategy on monetary policy transmission mechanism by estimating the impact of deposit rate on consumption to GDP ratio in emerging market economies. The study considers sixteen years of annual data from 2001 to 2016...

In closed or open economy models with complete markets, targeting core inflation enables monetary policy to maximize welfare by replicating the flexible price equilibrium. We analyze this result in the context of developing economies, where a large proportion of households are credit constrained...