Causes of Deviations of Inflation from CNB Targets: An Empirical Analysis

This paper provides an empirical analysis of the causes of deviations of inflation from the CNB targets. In the short term, shocks relating to prices of agricultural producers represent the most important factor. In the medium-term horizon, foreign exchange shocks form the most important factor. At the same time, it could not be proved that monetary policy would create any major shocks contributing to the non-fulfilment of inflation targets, although its certain role cannot be excluded either.