Commodities and monetary policy: Implications for inflation and price level targeting

optimal monetary policy and inflation targeting

in this paper, by using dynamic stochastic general equilibrium, optimal monetary rule derived for central bank of iran. monetary transmission mechanism of the model includes four equations, aggregate demand, aggregate supply, oil price and taylor rule. we have proved that dynamic structure of aggregate demand relation, regarding monetary inflation in iran, is a function of money growth rate. wi...

Monetary Policy and Inflation Targeting

In the 1990s, several countries shifted to a new monetary policy regime: an announced quantitative inflation target. The reason for this shift was the unsatisfactory performance under previous regimes. New Zealand, Canada, Australia, and Spain all introduced inflation targets under persistently high inflation; the United Kingdom, Sweden, and Finland did so after having abandoned fixed exchange ...

Monetary Policy and Inflation Targeting

On 21–22 July 1997, the Bank convened a conference entitled, 'Monetary Policy and Inflation Targeting'. The following excer pt is the introductory chapter of the conference volume. Medium-term price stability is widely accepted as the appropriate ultimate goal for monetary policy. This reflects two ideas. The first is that high rates of inflation distort decision-making, ultimately leading to s...

Reset Price Inflation and Monetary Policy

Bils, Klenow and Malin (2009) recently constructed an empirical measure of reset price inflation (i.e. the rate of change of all "desired" prices) for the US economy, by using the micro-data underpinning the CPI and evaluated whether the existing pricing models can explain both the observed reset inflation and aggregate inflation. They found that time-dependent models and state-dependent models...

Inflation Targeting and Optimal Monetary Policy