One test of an exchange-rate peg is to ask whether the implicit inflation target of the pegging country is the same as … that of the anchor country. If the inflation targets of the two countries are different, the peg's long-run credibility …

of flexible inflation targeting (price stability and the highest sustainable employment), including keeping average … inflation over a longer period on target; (2) not adding household debt as a new (intermediate) target variable, in addition to … inflation and unemployment – not “leaning against the wind,” which is counterproductive, but leaving any problems with household …

either price-level or nominal GDP targeting and compare these regimes to inflation targeting. These interest-rate rules are … domain of attraction of the targeted steady state, volatility of inflation and output and sensitivity to the speed of …

Inflation-targeting central banks have only imperfect knowledge about the effect of policy decisions on inflation. An … important source of uncertainty is the relationship between inflation and unemployment. This Paper studies the optimal monetary … policy in the presence of uncertainty about the natural unemployment rate, the short-run inflation-unemployment trade-off and …

Most central banks perceive a trade-off between stabilizing inflation and stabilizing the gap between output and … inflation is equivalent to stabilizing the welfare-relevant output gap. In this paper, we argue that this property of the new … trade-off between stabilizing inflation and stabilizing the welfare-relevant output gap. We show that not only does the …

Starting in the early 1990s, several emerging market and transition economies (EMEs) have adopted inflation targeting … preconditions for IT, (c) the use of intermediate exchange rate targets and (d) the specification of inflation targets. Our overall …

expectations data and forward interest rate data used to assess the credibility and predictability of policy under inflation …

income growth targeting versus optimal inflation targeting. When the economy under consideration is mainly subject to shocks … that do not involve monetary policy trade-offs for society, inflation targeting is preferable. Otherwise, nominal income … growth targeting may be superior because it induces inertial interest rate behaviour that improves the inflation-output gap …