IMF Working Papers

Establishing Initial Conditions in Support of Inflation Targeting

ByMark Zelmer, Andrea Schaechter, Mark R. Stone, Alina Carare

June 1, 2002

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Mark Zelmer, Andrea Schaechter, Mark R. Stone, and Alina Carare. "Establishing Initial Conditions in Support of Inflation Targeting", IMF Working Papers 2002, 102 (2002), accessed 12/19/2025, https://doi.org/10.5089/9781451852622.001

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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 provides some practical advice on establishing initial conditions in support of an inflation-targeting monetary framework. These conditions are divided into four areas: a mandate in support of an inflation objective and accountability for achieving this objective; macroeconomic stability; a sufficiently well-developed and stable financial system; and effective policy implementation tools. The measures taken by countries to meet these conditions are also reviewed.

Subject: Banking, Currency markets, Emerging and frontier financial markets, Exchange rates, Financial markets, Foreign exchange, Inflation, Inflation targeting, Monetary policy, Prices

Keywords: Africa, central bank, Currency markets, Emerging and frontier financial markets, emerging market country, emerging market inflation targeters, Exchange rates, Inflation, inflation outlook, inflation target, inflation targeters, inflation targeting, inflation-targeting country, inflation-targeting framework, inflation-targeting objective, interest rate, introducing inflation targeting, monetary policy, monetary policy framework, WP

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