Inflation targeting
Adopting a dual mandate will not solve South African unemployment – Kganyago
Unemployment problems are caused by structural issues, Sarb governor says; scope for reducing unemployment through monetary policy is “smaller” than people imagine
Book notes: Bankers, Bureaucrats and Central Bank Politics, by Christopher Adolph
An interesting, if slightly dated, analysis of those who made monetary policy decisions in advanced economies between 1950–2001, attempting to understand whether personal background influences decision-making
Bank of Jamaica outlines plans to become ‘modern’ central bank
Initiatives to implement inflation-targeting framework and liberalise forex rate already under way; IMF says strengthening autonomy will help
Ukraine’s Gontareva to step down
NBU governor says her mission is complete, resigning three years into a seven-year term amid intense pressure
Positive shock could still trip up advanced economies – Blanchard
Former IMF chief economist warns high debt levels could interact with positive shocks to cause problems; backs Rogoff’s plan for a cashless society
Kashkari explains his sole FOMC dissent
Minneapolis chief reminds his colleagues the Fed treats 2% inflation as a target, not a ceiling; urges FOMC to publish plan for shrinking balance sheet
Lifetime achievement award: Donald Kohn
Donald Kohn’s objectivity, intelligence, humour, tireless energy and iron determination to get the job done epitomise the role of a dedicated public servant. He serves as an inspiration to others
Kazakhstan’s long path to inflation targeting
After a slow start, the National Bank of Kazakhstan’s implementation of inflation forecast targeting is beginning to mature. By Warren Coats
Kazakhstan’s Akishev sets sights on lower inflation
Governor hails success with inflation targeting and says central bank now plans to push inflation even lower; NBK also working on new banking supervision framework
Norges Bank defends policy framework amid government review
The government is assessing the central bank’s governance and monetary policy; Norges Bank says it needs a “long and flexible horizon” to be able to properly conduct its policy framework
Harker optimistic in first speech as FOMC voting member
Inflation target set to be met this year, says Philadelphia Fed governor, noting labour force participation issues need to be addressed with legislative action
Sri Lankan government to restructure central bank
Central bank is to be restructured with amendments to the Banking Act, but disagreements remain between the finance minister and governor; inflation-targeting framework appears to be on track
Adopting inflation target can create higher inflation – paper
Bank of Korea working paper finds positive relationship between inflation target and inflation, implying some central banks may be tempted to move the goalposts
Inflation to reach 2% target in next six months, BoE says
MPC votes unanimously to leave rates unchanged at 0.25%; exchange rate appreciation suggests smaller overshoot of inflation target than previously forecast
Riksbank’s Jansson rejects calls to scrap inflation target
Critics likely underestimate the benefits of the current monetary policy framework when calling for it to change, deputy governor says
Serbia is ready for lower inflation target – Tabaković
Monetary policy and fiscal discipline has allowed Serbia to “join the ranks” of low-inflation countries; projections for growth revised up
Central Bank of Honduras legislation needs to be ‘fast tracked’, says IMF
Implementation of inflation targeting regime hinges on legislative change, IMF says in latest report; Honduran authorities to submit legislative reform on central bank mandate by March 2017
BoJ paper designs new measure of trend inflation
Author’s measure reflects the weighted average of an adaptive component and a forward-looking component
Canada opts to retain 2% inflation target
Bank of Canada will continue with current target in new five-year deal with government, though other aspects of the policy framework are changing
What else can central banks do?
Geneva Report’s plea for central banks to use more negative rates, additional QE and helicopter drops appears misguided
Benefits to inflation overshooting target – Chicago Fed president
Policy-makers “willing to accept” inflationary risk that comes with falling unemployment if Fed overshoots target, Evans says
Bank of Canada should not raise inflation target – Obstfeld and co-authors
Central bank has been overtaken in transparency metrics, authors say; forward guidance would catapult Canada to top of rankings and could avoid the need for unconventional measures
Mexico inflation could be affected by exchange rate and US events
Mexico’s board to closely monitor exchange rate pass-through on consumer prices, quarterly review says; outcome of US election and the normalisation of the Fed's interest rate also a concern
Riksbank highlights complexity in choice of target
Report studies case for changing target to CPIF or HICP inflation, and reinstating target band, ahead of discussions over monetary framework reforms