We construct a time varying financial openness index by estimating a small open economy model of interest rate determination and examine the implications of evolution of capital account liberalisation on economic performance over the period April 1993 - March 2004. The behaviour of openness...

This paper examines how the Bank of England conducts monetary policy in practice and assesses its policy preferences. Our empirical results using monthly ex post inflation forecast suggest that pursued policy can be characterized by a nonlinear policy reaction function with a deflation bias. We...

The Opportunistic Approach to disinflation is an influential model of optimal monetary policy. This strategy for disinflation suggests that in a low inflation environment policymakers' would give higher weight to inflation stabilization when inflation is strengthening, but higher weight to...

In the recent past, international crude oil markets have witnessed significant fluctuations and such fluctuations tend to have ramifications on the economy as a whole. In this regard, this paper makes an attempt to model such volatility spillover from oil price returns to the returns `of the...

Inflation rates in a number of developed countries follow a common trend over the past five decades: inflation starts out low in the 1950s, rises for a time before peaking in the 1970s, and then falls back to initial levels. Interestingly the behaviour of trend inflation in India broadly...