Inflation Expectations and Central Bank Communication in Turkey
Yusuf Baskaya (),
Eda Gulsen () and
Hakan Kara ()
Central Bank Review, 2012, vol. 12, issue 2, 1-10
This study assesses how inflation expectations respond to inflation targets, forecasts, and realizations with a particular focus on whether the sensitivity of expectations to inflation realizations increases with the level of inflation. For the sample period between April 2006 and May 2012, our findings indicate that forecasts, targets, and past inflation are important determinants of inflation expectations. Moreover, expectations are more sensitive to inflation realizations at higher levels of inflation. Interestingly, we find that sensitivity of expectations to inflation has decreased over time, especially since the end of 2011 despite a very rapid and sizable increase in CPI inflation due to one-off factors. Our results suggest that the implementation of tight monetary policy and intensive communication efforts by Central Bank of the Republic of Turkey might have reduced the sensitivity of expectations to the inflation realizations.
Keywords: Monetary policy; Inflation expectations; Central bank communication (search for similar items in EconPapers)
JEL-codes: C51 E58 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12) Track citations by RSS feed
Downloads: (external link)
http://www.tcmb.gov.tr/wps/wcm/connect/EN/TCMB+EN/ ... ew/2012/Volume+12-2/ (application/pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:tcb:cebare:v:12:y:2012:i:2:p:1-10
Access Statistics for this article
More articles in Central Bank Review from Research and Monetary Policy Department, Central Bank of the Republic of Turkey Contact information at EDIRC.
Bibliographic data for series maintained by () and () and ().