Efectos de la Nominalización de la Política Monetaria en Chile

Rodrigo Fuentes, Alejandro Jara, Klaus Schmidt-Hebbel, Matias Tapia and Erika Arraño

Working Papers Central Bank of Chile from Central Bank of Chile

Abstract: The Central Bank of Chile replaced its monetary policy instrument in August 2001, shifting from a monetary policy rate (MPR) linked to an indexed unit of account (UF, defined by the lagged CPI) to a nominal MPR denominated in pesos. This policy change was complemented with a significant change in the Central Bank’s liability structure, from short and medium-term indexed debt to nominal peso debt. This paper analyses, both conceptually and empirically, the main effects of MPR nominalization on financial markets and the conduct and effectiveness of monetary policy. As opposed to previous studies on this subject, this paper concludes that the main advantage of nominalization was a widening of monetary policy options, precluding critical situations in the conduct of monetary policy that would have occurred at low MPR levels under the previous scheme of indexed MPRs.

Date: 2003-01
New Economics Papers: this item is included in nep-cba, nep-lam and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

Downloads: (external link)
https://www.bcentral.cl/documents/33528/133326/DTBC_197.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:chb:bcchwp:197

Access Statistics for this paper

More papers in Working Papers Central Bank of Chile from Central Bank of Chile Contact information at EDIRC.
Bibliographic data for series maintained by Alvaro Castillo ().