Inter-forecast monetary policy implementation: fixed-instrument versus MCI-based strategies

Ben Hunt
Additional contact information
Ben Hunt: Reserve Bank of New Zealand, http://www.rbnz.govt.nz

No G99/1, Reserve Bank of New Zealand Discussion Paper Series from Reserve Bank of New Zealand

Abstract: Monetary policy authorities can adjust their instrument at any point in time to achieve their policy objective. In some countries, such as the United States and the United Kingdom, policymakers choose to usually make adjustments only after a formal medium-term inflation forecast. Other countries, like Canada and New Zealand, have used simple inter-forecast strategies to make further instrument adjustments given unexpected developments in the exchange rate. These alternative strategies may be usefully thought of as fixing or banding a measure of "monetary conditions" that is comprised of the exchange rate and a short-term interest rate that is closely linked to the policy instrument. Such measures have come to be referred to as Monetary Conditions Indices (MCI).

Pages: 33p
Date: 1999-03
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://www.rbnz.govt.nz/-/media/ReserveBank/Files/ ... apers/1999/g99-1.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:nzb:nzbdps:1999/01

Access Statistics for this paper

More papers in Reserve Bank of New Zealand Discussion Paper Series from Reserve Bank of New Zealand Contact information at EDIRC.
Bibliographic data for series maintained by Reserve Bank of New Zealand Knowledge Centre ().