The Journey to Inflation Targeting: Easier Said than Done The Case for Transitional Arrangements along the Road


Bernard J Laurens ; Kelly Eckhold ; Darryl King ; Nils Øyvind Mæhle ; Abdul Naseer ; Alain Durré

Publication Date:

June 25, 2015

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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


Countries with evolving monetary regimes that decide to embark on “the Journey to inflation targeting” may not be able to adopt a full-fledged inflation targeting regime immediately. Those countries would be better off adopting transitional arrangements that take advantage of the informational content of monetary aggregates, developing an economic analysis capacity, and concentrating on monetay operations aimed at steering money market interest rates. This approach would allow the central bank to buy time for developing the building blocks for effective monetary policy, support transparent central bank communication, and limit the potential for undesirable outcomes along the road.


Working Paper No. 2015/136



Publication Date:

June 25, 2015



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