Announcements and credibility under inflation targeting

Announcements and credibility under inflation targeting

We inspect how inflation target announcements are instrumental in building central bank credibility and shaping inflation expectations. Investigating the role of announcements by using a time varying credibility measure, we find that both the accuracy and the frequency of inflation announcements hav...

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Veröffentlicht in:Economics letters 2008-08, Vol.100 (2), p.249-253
Hauptverfasser: Demir, Banu, Yigit, Taner M.
Format: Artikel
Sprache:eng
Schlagworte:
Central banks
Central Banks and Their Policies E580
Deflation E310
E31
E42
E58
Expectation
Inflation
Inflation expectations
Inflation target announcements
Inflation targeting
Information dissemination
Learning
Price Level
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Beschreibung
Zusammenfassung:We inspect how inflation target announcements are instrumental in building central bank credibility and shaping inflation expectations. Investigating the role of announcements by using a time varying credibility measure, we find that both the accuracy and the frequency of inflation announcements have a positive impact on how much attention the public pays to target announcements.
ISSN:0165-1765
1873-7374
DOI:10.1016/j.econlet.2008.02.002