Inflation Targeting for Slovenia?

Mejra Festić

Eastern European Economics, 2003, vol. 41, issue 1, 79-98

Abstract: The inflation rate in Slovenia is too high for integration into the European Monetary System. This article argues that inflation targeting is not a suitable approach for lowering the inflation rate in Slovenia because it brings instability; there is insufficient data for the requisite analysis, and the financial environment is insufficiently developed. Inflation targeting requires a discretionary monetary policy, but a small open economy, such as Slovenia, depends on foreign economies and their cyclical movements.

Date: 2003
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