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Strategy and Tactics of Monetary Policy: Examples from Europe and the Antipodes

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  • José Viñals
  • Charles Goodhart

Abstract

What we shall concentrate on in this paper is the way in which the strategy and tactics of monetary policy are currently being articulated in this current context. We document in Section 2, the common adoption of price stability as the overriding priority. This does not, however, prevent the adoption of subsidiary objectives. While price stability has now been generally accepted as the dominant objective for Central Banks monetary policy, the term `price stability has most often not been defined, either legislatively or in practice. We shall discuss some possible alternative definitions, and the pros and cons of adopting them in this Section, eg the choice of index and whether the objective should be expressed in terms of a price level, or rate of inflation (eg zero).

Suggested Citation

  • José Viñals & Charles Goodhart, 1994. "Strategy and Tactics of Monetary Policy: Examples from Europe and the Antipodes," FMG Special Papers sp61, Financial Markets Group.
    • Handle: RePEc:fmg:fmgsps:sp61
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    File URL: http://www.lse.ac.uk/fmg/documents/specialPapers/1990s/sp61.pdf
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    References listed on IDEAS

    as
    1. Canzoneri,Matthew B. & Grilli,Vittorio & Masson,Paul R. (ed.), 1992. "Establishing a Central Bank," Cambridge Books, Cambridge University Press, number 9780521420983, January.
    2. Persson, Torsten & Tabellini, Guido, 1993. "Designing institutions for monetary stability," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 39(1), pages 53-84, December.
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