Did the financial crisis bring any changes in the monetary policy preferences of Romania?

Ágnes Nagy () and Annamária Dézsi-Benyovszki ()
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Ágnes Nagy: Babeş-Bolyai University, Institute of Economics and Business Administration in Hungarian Language, Faculty of Economics and Business Administration, Cluj-Napoca, Romania

Acta Oeconomica, 2014, vol. 64, issue supplement1, 111-131

Abstract: The turbulence in global financial markets presents a serious challenge to the stability of the monetary policy trilemma configuration. The trilemma states that a country may simultaneously choose only two of the following three policy goals: monetary policy independence, exchange rate stability, and financial integration. In order to analyse if the financial crisis brought changes in Romania’s monetary policy preference, we have constructed indexes that measure the trilemma policy goals individually in the period between 2005 and 2012. Using these indices, we have shown that there are significant differences between the means of monetary independence and exchange rate stability indices in the pre- and post-crisis periods.

Keywords: impossible trinity; monetary policy independence; exchange rate stability; financial integration; dynamic conditional correlations (DCC); Romania (search for similar items in EconPapers)
JEL-codes: E52 E58 F21 F31 O24 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (1)

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