Assigning a discretionary central bank a mandate to stabilize an average inflation rate—rather than a period …-by-period inflation rate—increases welfare in a New Keynesian model with an occasionally binding lower bound on nominal interest rates … inflation targeting (AIT) is equivalent to price level targeting (PLT). However, AIT with a finite, but sufficiently long …

Inflation targeting is implemented in different ways – most often by adopting point targets, by having tolerance bands … target types affect the anchoring of inflation expectations at shorter horizons differently. It tests two contradictory …. This suggests that there are some benefits to adopting intervals, but the central bank can anchor inflation expectations …

cross-country differences in the mismatch of perceived and actual inflation in the aftermath of the cash changeover are …

We develop a theoretical model that features a business cycle-dependent relation between output, price inflation and … inflation expectations, augmenting the model by Svensson (1997) with a nonlinear Phillips curve that reflects the rationale … pronounced convex relationship between inflation and the output gap, meaning that the co-efficient in the Phillips curve on the …

Under inflation targeting inflation exhibits negative serial correlation in the United Kingdom, and little or no …, inflation appears to be (nearly) purely forward-looking, so that no mechanism introducing backward-looking components is … necessary to fit the data. These results question the notion that the intrinsic inflation persistence found in post-WWII U …

interpreted, first and foremost, as a commitment device. In our setting, a monetary target helps anchoring inflation and inflation … well as a strong response to deviations of inflation from target and to the activity growth gap. In contrast, the response …

is derived from policy-makers' preferences about inflation outcomes, we first show that downside risks to price stability … future inflation can provide insurance against the materialization of such upside risks …

qualitative and quantitative information on subsequent inflation. The usefulness of monetary analysis is contrasted to weaknesses … in modeling monetary policy and inflation with respectively short-term interest rates and real activity measures. The … analysis sheds light on the recent change in inflation volatility and persistence as well as on the Phillips curve flattening …

We develop a theoretical model that features a business cycle-dependent relation between out- put, price inflation and … inflation expectations, augmenting the model by Svensson (1997) with a nonlinear Phillips curve that reflects the rationale … pronounced convex relationship between inflation and the output gap, meaning that the coefficient in the Phillips curve on the …