{
  "title": "The Scope for Inflation Targeting in Developing Countries",
  "publication": "IMF Working Papers, October 1, 1997",
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  "summary": "Inflation targeting (IT) serves as monetary policy framework in several advanced economies, where it has enhanced policy transparency and accountability. The paper considers its wider applicability to developing countries.",
  "sections": [
    {
      "heading": "Summary findings",
      "content": "- Inflation targeting (IT) serves as monetary policy framework in several advanced economies, where it has enhanced policy transparency and accountability.\n- The paper considers the wider applicability of IT to developing countries.\n- The prerequisites for a successful IT framework are identified as:\n  - an ability to carry out an independent monetary policy (free of fiscal dominance or commitment to another nominal anchor, like the exchange rate); and\n  - a quantitative framework linking policy instruments to inflation.\n- These prerequisites are largely absent among developing countries.\n- Several developing countries could, with some further institutional changes and an overriding commitment to low inflation, make use of an IT framework."
    },
    {
      "heading": "Key policy implications and recommendations",
      "content": "- Strengthen central bank independence to ensure monetary policy is free of fiscal dominance.\n- Avoid commitments to another nominal anchor (for example, the exchange rate) if adopting an IT framework.\n- Develop and maintain a quantitative framework that links policy instruments explicitly to inflation outcomes.\n- Pursue an overriding commitment to low inflation as a precondition for successful IT adoption.\n- Implement institutional changes that create the necessary conditions for IT in countries where prerequisites are currently lacking."
    },
    {
      "heading": "Context and scope",
      "content": "- The analysis focuses on the applicability of inflation targeting to developing countries and contrasts experiences with advanced economies where IT has already enhanced transparency and accountability.\n- Subjects covered include: Banking, Central bank autonomy, Central banks, Exchange rates, Foreign exchange, Inflation, Inflation targeting, Monetary policy, Monetary policy frameworks, Prices.\n\nThe Scope for Inflation Targeting in Developing Countries — Miguel A Savastano, Paul R Masson, Sunil Sharma; October 1, 1997.\n\n---\n\n Content in this bundle\n\n- The Scope for Inflation Targeting in Developing Countries -WP/97/130\n  - The Scope for Inflation Targeting in Developing Countries -WP/97/130 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - The Scope for Inflation Targeting in Developing Countries -WP/97/130 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/30/the-scope-for-inflation-targeting-in-developing-countries-2356"
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    "Authors: Miguel A Savastano, Paul R Masson, Sunil Sharma",
    "Published: October 1, 1997",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451855159.001",
    "Inflation targeting (IT) serves as monetary policy framework in several advanced economies, where it has enhanced policy transparency and accountability.",
    "The paper considers the wider applicability of IT to developing countries.",
    "The prerequisites for a successful IT framework are identified as:",
    "These prerequisites are largely absent among developing countries.",
    "Several developing countries could, with some further institutional changes and an overriding commitment to low inflation, make use of an IT framework.",
    "Strengthen central bank independence to ensure monetary policy is free of fiscal dominance.",
    "Avoid commitments to another nominal anchor (for example, the exchange rate) if adopting an IT framework.",
    "Develop and maintain a quantitative framework that links policy instruments explicitly to inflation outcomes.",
    "Pursue an overriding commitment to low inflation as a precondition for successful IT adoption.",
    "Implement institutional changes that create the necessary conditions for IT in countries where prerequisites are currently lacking.",
    "The analysis focuses on the applicability of inflation targeting to developing countries and contrasts experiences with advanced economies where IT has already enhanced transparency and accountability.",
    "Subjects covered include: Banking, Central bank autonomy, Central banks, Exchange rates, Foreign exchange, Inflation, Inflation targeting, Monetary policy, Monetary policy frameworks, Prices.",
    "**The Scope for Inflation Targeting in Developing Countries -WP/97/130**"
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