Monetary Policy and Leading Indicators of Inflation in Sweden

Author/Editor:

Göran Zettergren ; Josef Baumgartner ; Ramana Ramaswamy

Publication Date:

April 1, 1997

Electronic Access:

Free Full text (PDF file size is 1614 KB).Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper derives a set of leading indicators of inflation for Sweden. It also discusses methodological and policy issues pertaining to the estimation of these indicators. The main findings are: (1) narrow money is the most powerful leading inflation indicator; (2) broad money and inflation expectations have significant predictive information on inflation; (3) the output gap, interest rates, and the credit aggregate have some predictive information on inflation, and this information is confined to a shorter time horizon than either the monetary aggregates or inflation expectations; and (4) implied forward rates have only weak predictive information on inflation.

Series:

Working Paper No. 97/34

Subject:

English

Publication Date:

April 1, 1997

ISBN/ISSN:

9781451978926/1018-5941

Stock No:

WPIEA0341997

Price:

$15.00 (Academic Rate:$15.00)

Format:

Paper

Pages:

31

Please address any questions about this title to publications@imf.org