Inflation targeting and the role of exchange rate pass-through

Arbeitspapier

The paper presents evidence on the exchange rate pass-through for a set of emerging and developed economies before and after the adoption of Inflation Targeting. We use an ARDL model for a sample of developed and emerging market economies to estimate the short-run and the long-run effects of depreciations on prices. The results support the view of the previous literature that the pass-through is higher for emerging than for developed economies, and that it has decreased after the adoption of Inflation Targeting. This reduction, however, does not mean that the pass-through is no longer existent for developed and emerging market economies, especially when it comes to the long-run. This finding highlights the importance of using dynamic models when dealing with the inflation-depreciation relationship. The results also show the important role of foreign producer costs for the imports pricing behaviour in developed economies, and of inflation stability in emerging markets.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: Department of Economics Discussion Paper ; No. 06,02

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Price Level; Inflation; Deflation ; Monetary Policy ; Foreign Exchange ; Open Economy Macroeconomics
• Thema: Inflation Targeting ; Exchange Rate Pass-Through

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Nogueira, Reginaldo Pinto
• Ereignis: Veröffentlichung
• (wer): University of Kent, Department of Economics
• (wo): Canterbury
• (wann): 2006

Weitere Informationen

• Handle: http://hdl.handle.net/10419/68101
• Letzte Aktualisierung: 10.03.2025, 11:42 MEZ