Inflation-linked bonds from a central bank perspective

Juan Garcia () and Adrian Rixtel ()
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Juan Garcia: Europena Central Bank

No 705, Occasional Papers from Banco de España

Abstract: Inflation-linked bond markets have experienced significant growth in recent years. This growth is somewhat surprising, for inflation-linked bonds cannot be considered a financial innovation and their development has taken place in a period of historically low global inflation and inflation expectations. In this context, the purpose of this paper is twofold. First, it provides a selective survey of the key arguments for and against the issuance of inflation-linked debt, and some of the factors that help to understand their recent growth. Second, it illustrates the use of these instruments to better monitor investors’ inflation expectations and growth prospects from a central bank perspective.

Keywords: central banks; monetary policy; inflation-linked bonds; break-even inflation rates (search for similar items in EconPapers)
JEL-codes: E44 E52 E58 G10 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2007-08
New Economics Papers: this item is included in nep-cba, nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (51)

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Persistent link: https://EconPapers.repec.org/RePEc:bde:opaper:0705

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