LEADER 06379oam 22011414 450 001 9910825972303321 005 20240402051728.0 010 $a1-4623-7896-X 010 $a1-4527-4198-0 010 $a1-282-84435-0 010 $a1-4518-7381-6 010 $a9786612844355 035 $a(CKB)3170000000055346 035 $a(SSID)ssj0000941465 035 $a(PQKBManifestationID)11494047 035 $a(PQKBTitleCode)TC0000941465 035 $a(PQKBWorkID)10964094 035 $a(PQKB)10137126 035 $a(OCoLC)680613563 035 $a(IMF)WPIEE2009234 035 $a(MiAaPQ)EBC1608821 035 $a(EXLCZ)993170000000055346 100 $a20020129d2009 uf 0 101 0 $aeng 135 $aurcn||||||||| 181 $ctxt 182 $cc 183 $acr 200 10$aHybrid Inflation Targeting Regimes /$fCarlos Garcia, Jorge Restrepo, Scott Roger 205 $a1st ed. 210 1$aWashington, D.C. :$cInternational Monetary Fund,$d2009. 215 $a57 p. $cill 225 1 $aIMF Working Papers 300 $a"October 2009." 311 $a1-4519-1799-6 327 $aIntro -- CONTENTS -- Introduction -- I. Inflation Targeting in an Open Economy -- II. Model Characteristics and Calibration -- The small open economy model -- Calibration of "advanced" and "emerging economy" models -- III. A Taxonomy of Hybrid Inflation Targeting Approaches -- "Plain vanilla" inflation targeting in an open economy -- Open-economy inflation targeting -- Inflation targeting with an exchange rate band -- Exchange rate-based inflation targeting -- IV. Evaluation of Hybrid Inflation Targeting Rules -- Hybrid policy rules and the inflation-output volatility trade-off -- How much weight to put on the exchange rate in a hybrid policy rule? -- How hybrid policy rules affect a wider range of macroeconomic variables? -- General assessment -- Caveats -- Tables -- 1. Macroeconomic and Financial Volatility Associated with Alternative Policy Rules -- Figures -- 1. Plain Vanilla Inflation Targeting in the Robust Advanced Economy and the Vulnerable Emerging Economy -- 2. Alternative Hybrid Policy Rules and the Variability of Inflation and Output in Advanced and Emerging Market Economies -- 3. The Impact of Exchange Rate Smoothing on the Variability of Inflation and Output in Robust Advanced and Vulnerable Emerging Market Economies -- 4. Performance of Alternative Policy Rules on Macroeconomic and Financial Volatility in Advanced and Emerging Market Economies -- Appendices -- I. Optimization in the Model -- II. Calibration of the Model -- A. Construction of Volatility Trade-off Frontiers -- B. Impulse Responses -- Domestic demand shocks -- Cost-push shocks -- Risk premium shocks -- C. Volatility of Macroeconomic and Financial Variables Under Different Policy Rules -- III. Simulations -- Appendix Tables -- 1. Parameter Calibration of the Advanced and Emerging Market Economy -- 2. Reaction Function Coefficients. 327 $a3a. Performance of Alternative Policy Rules in Response to Demand Shocks -- 3b. Performance of Alternative Policy Rules in Response to Cost-Push Shocks -- 3c. Performance of Alternative Policy Rules in Response to Risk Premium Shocks -- Appendix Figures -- 1. Inflation and Output Volatility With Demand Shocks and Plain Vanilla Inflation Targeting -- 2. Responses to a Demand Shock -- 3. Responses to a Cost-push Shock -- 4. Responses to a Risk Premium Shock -- References. 330 3 $aThis paper uses a DSGE model to examine whether including the exchange rate explicitly in the central bank's policy reaction function can improve macroeconomic performance. It is found that including an element of exchange rate smoothing in the policy reaction function is helpful both for financially robust advanced economies and for financially vulnerable emerging economies in handling risk premium shocks. As long as the weight placed on exchange rate smoothing is relatively small, the effects on inflation and output volatility in the event of demand and cost-push shocks are minimal. Financially vulnerable emerging economies are especially likely to benefit from some exhange rate smoothing because of the perverse impact of exchange rate movements on activity. 410 0$aIMF Working Papers; Working Paper ;$vNo. 2009/234 606 $aInflation (Finance) 606 $aAnti-inflationary policies 606 $aForeign Exchange$2imf 606 $aInflation$2imf 606 $aInvestments: General$2imf 606 $aMoney and Monetary Policy$2imf 606 $aPrice Level$2imf 606 $aDeflation$2imf 606 $aInvestment$2imf 606 $aCapital$2imf 606 $aIntangible Capital$2imf 606 $aCapacity$2imf 606 $aMonetary Policy$2imf 606 $aCurrency$2imf 606 $aForeign exchange$2imf 606 $aMacroeconomics$2imf 606 $aMonetary economics$2imf 606 $aExchange rates$2imf 606 $aReturn on investment$2imf 606 $aInflation targeting$2imf 606 $aReal exchange rates$2imf 606 $aPrices$2imf 606 $aSaving and investment$2imf 606 $aMonetary policy$2imf 607 $aSingapore$2imf 615 0$aInflation (Finance) 615 0$aAnti-inflationary policies. 615 7$aForeign Exchange 615 7$aInflation 615 7$aInvestments: General 615 7$aMoney and Monetary Policy 615 7$aPrice Level 615 7$aDeflation 615 7$aInvestment 615 7$aCapital 615 7$aIntangible Capital 615 7$aCapacity 615 7$aMonetary Policy 615 7$aCurrency 615 7$aForeign exchange 615 7$aMacroeconomics 615 7$aMonetary economics 615 7$aExchange rates 615 7$aReturn on investment 615 7$aInflation targeting 615 7$aReal exchange rates 615 7$aPrices 615 7$aSaving and investment 615 7$aMonetary policy 676 $a332.4;332.41 700 $aGarci?a$b Carlos$g(Garci?a Brun)$0744235 701 $aRestrepo$b Jorge$0402651 701 $aRoger$b Scott$01636986 712 02$aInternational Monetary Fund.$bMonetary and Capital Markets Dept. 801 0$bDcWaIMF 906 $aBOOK 912 $a9910825972303321 996 $aHybrid Inflation Targeting Regimes$93978554 997 $aUNINA