<abstract xmlns="http://www.w3.org/1999/xhtml"><p>The main motives behind the adoption of an inflation targeting regime largely relate to the notion of credibility, transparency of monetary policy and the autonomy of the central bank, which explicitly undertakes to achieve a certain inflation target. This paper examines the effects of inflation targeting in emerging economies in relation to the degree of independence of the central bank and the credibility of monetary policy. We find effects in emerging economies with little central bank independence, so our findings suggest that the central bank’s credibility, transparency and independence is a prerequisite for emerging economies to experience a decline in inflation following the adoption of inflation targeting.</p></abstract>

The main motives behind the adoption of an inflation targeting regime largely relate to the notion of credibility, transparency of monetary policy and the autonomy of the central bank, which explicitly undertakes to achieve a certain inflation target. This paper examines the effects of inflation targeting in emerging economies in relation to the degree of independence of the central bank and the credibility of monetary policy. We find effects in emerging economies with little central bank independence, so our findings suggest that the central bank’s credibility, transparency and independence is a prerequisite for emerging economies to experience a decline in inflation following the adoption of inflation targeting.

Central Bank Credibility, Independence, and Monetary Policy

BETA Lab UMR 7522 University of Lorraine and UR MOFID UR 13-ES60

Journal of Central Banking Theory and Practice

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

{"article-title":"Central Bank Credibility, Independence, and Monetary Policy"}

The main motives behind the adoption of an inflation targeting regime largely relate to the notion of credibility, transparency of monetary policy and the...

Central Bank Credibility, Independence, and Monetary Policy

Published Online: Sep 10, 2018

Page range: 91 - 110

Received: Aug 13, 2017

Accepted: Dec 27, 2017

DOI: https://doi.org/10.2478/jcbtp-2018-0025

Keywords
Credibility, transparency, central bank independence, inflation targeting

© 2018 Abdelkader Aguir, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Central Bank Credibility, Independence, and Monetary Policy

Published Online: Sep 10, 2018

Page range: 91 - 110

Received: Aug 13, 2017

Accepted: Dec 27, 2017

DOI: https://doi.org/10.2478/jcbtp-2018-0025

KeywordsCredibility, transparency, central bank independence, inflation targeting

© 2018 Abdelkader Aguir, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Keywords
Credibility, transparency, central bank independence, inflation targeting