E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook

• Asset-Price Misalignments and Monetary Policy: How Flexible Should Inflation-Targeting Regimes Be?

  Staff Discussion Paper 2007-6 Jack Selody, Carolyn A. Wilkins

  The authors analyze the extent to which inflation-targeting frameworks should incorporate flexibility in order to respond to asset-price misalignments and other atypical events. They examine the costs and benefits of adding flexibility to the Bank's current inflation-targeting framework, and conclude that maintaining low and stable consumer price inflation is the best contribution that monetary policy […]

  Content Type(s): Staff research, Staff discussion papers Topic(s): Inflation targets, Monetary policy framework JEL Code(s): E, E5, E6