Inflation targeting and monetary analysis in Chile and Mexico
No 179, Royal Economic Society Annual Conference 2003 from Royal Economic Society
This paper studies the role of monetary and open economy indicators in inflation targeting (IT) economies through the analysis of a nested Phillips curve/ P-star model for Chile and Mexico. For Chile a real money gap and a money growth indicator are found to be relevant in predicting deviations of observed from target inflation. In contrast, for Mexico real exchange rate measures are robust predictors of deviations of actual from (i) expected inflation during the pre-IT (1999) period, and (ii) target inflation in the post-IT span.
Keywords: inflation targeting; monetary policy; money demand; PPP; P-star; Phillips curve; cointegration; Kalman filter; block Granger non-causality; VARs (search for similar items in EconPapers)
JEL-codes: E30 E40 E50 F41 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ifn and nep-mon
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Working Paper: Inflation targeting and monetary analysis in Chile and Mexico (2004)
Working Paper: Inflation targeting and monetary analysis in Chile and Mexico (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:ecj:ac2003:179
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