What does South Korean inflation targeting target?

Marcelo Sánchez

Journal of Asian Economics, 2010, vol. 21, issue 6, 526-539

Abstract: This paper characterises South Korean monetary policy in the period of explicit inflation targeting that started in 1999. We calculate Bank of Korea's parameters in the policy objective function, conditional on an estimated macro-model. We show that this central bank appears to have pursued optimal policy geared towards achieving price stability, while displaying a considerable degree of interest rate smoothing. In addition, the central bank loss function is estimated to include negligible weights on output and exchange-rate variability.

Keywords: Inflation; targeting; Optimal; monetary; policy; Emerging; market; economies; South; Korea (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:asieco:v:21:y:2010:i:6:p:526-539

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