Country Experiences with the Introduction and Implementation of Inflation Targeting

IMF Working Papers, July 1, 2009

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Canonical URL: Country Experiences with the Introduction and Implementation of Inflation Targeting

This is the tenth chapter of a forthcoming monograph entitled, "On Implementing Full- Fledged Inflation-Targeting Regimes: Saying What You Do and Doing What You Say."
Describes the experiences of a number of countries with the introduction and implementation of inflation targeting (IT) regimes.
Discusses:
- Motivation for introducing IT.
- How countries fared in meeting various conditions argued to be needed in advance of introducing IT.
- How countries transitioned to a full-fledged IT framework and coordinated preparations with other economic policies and reforms.
- Benefits gained by adopting IT.
- Challenges faced in implementation.
- Lessons from their experiences.

Motivation and Rationale
- Countries adopted IT to achieve clearer, more credible monetary policy frameworks oriented toward price stability.
Preconditions and Readiness
- The chapter assesses how countries met the conditions some consider necessary before adopting IT.
Transition and Coordination
- Details on transitioning to full-fledged IT frameworks and coordination with fiscal and other economic policies.
Benefits and Outcomes
- Examines benefits countries gained by adopting IT.
Implementation Challenges
- Identifies practical and institutional challenges encountered in implementing IT.
Lessons Learned
- Synthesizes lessons from multiple country experiences to inform future IT adopters.