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Inflation Forecast Targeting: Implementing and Monitoring Inflation Targets

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  • Lars E O Svensson

Abstract

The paper discusses the implementation of inflation-targeting across countries. It argues that the intermediate variable under an inflation target is, in effect, the inflation forecast. Such a regime is shown to confer benefits over other regimes, such as money and exchange rate targeting: in terms of the efficient implementation of policy; in terms of transparency; and in terms of the stabilisation of inflation and output.

Suggested Citation

  • Lars E O Svensson, 1996. "Inflation Forecast Targeting: Implementing and Monitoring Inflation Targets," Bank of England working papers 56, Bank of England.
    • Handle: RePEc:boe:boeewp:56
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    References listed on IDEAS

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    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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