The Taylor Rule and Inflation Targeting in Moldova

Denis Vîntu

MPRA Paper from University Library of Munich, Germany

Abstract: This paper analyzes the implementation, effectiveness, and challenges of the inflation targeting framework in the Republic of Moldova. It explores the theoretical foundations of inflation targeting, reviews Moldova’s historical transition from high and volatile inflation to a structured monetary policy framework, and examines the National Bank of Moldova's strategies for achieving price stability. Empirical analysis of policy performance, including Taylor Rule estimates and responses to economic shocks, is presented. The study highlights the strengths of inflation targeting, such as enhanced credibility and anchored inflation expectations, while also addressing challenges related to external shocks, structural constraints, and data limitations. Finally, the paper provides perspectives for improving Moldova’s monetary policy framework, emphasizing forecasting, communication, and institutional capacity, thereby contributing to sustainable economic stability and growth.

Keywords: Inflation Targeting; Taylor Rule; Monetary Policy; Republic of Moldova; Central Bank; Price Stability; Emerging Economies; Interest Rate Policy; Macroeconomic Stability; Policy Effectiveness (search for similar items in EconPapers)
JEL-codes: E31 E52 E58 F41 O23 (search for similar items in EconPapers)
Date: 2025-08, Revised 2025-08
References: Add references at CitEc
Citations:

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/125839/1/MPRA_paper_125839.pdf original version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:125839

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().