IMF Working Paper - The ECB's Inflation Objective

IMF Working Paper 'The ECB's Inflation Objective' by Mads Kieler. The ECB's objective of medium-term inflation below 2 percent has been portrayed by critics as ambiguous, asymmetric, and excessively stringent. This paper attempts a comprehensive evaluation of the trade-offs for the euro area and finds that in terms of guiding inflation expectations and policymaking, the current definition has functioned much as would an inflation target centred on 1.5-1.75 percent.

The ECB's Inflation Objective

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