Inflation Regimes and Inflation Expectations
RBA Research Discussion Papers from Reserve Bank of Australia
There has been much talk in the popular press about the difficulty of attaining credibility in the bond markets for the low-inflation policies that have been adopted by a number of central banks in recent years. This credibility problem is particularly severe for those countries that have a history of high inflation. Gaining credibility is often viewed in the context of learning by the public about the central bank’s true intentions. However, this paper argues that a more important aspect of credibility – at least for long-term inflation expectations – may be public views about how future changes in personnel, electoral results, or economic shocks may affect central bank behaviour. In other words, there is always a positive probability that the current regime will end. Views about the nature of possible future regimes are likely to be influenced by observed past regimes.
JEL-codes: E31 E58 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
Journal Article: Inflation regimes and inflation expectations (2008)
Working Paper: Inflation regimes and inflation expectations (1997)
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:rba:rbardp:rdp9701
Access Statistics for this paper
More papers in RBA Research Discussion Papers from Reserve Bank of Australia Contact information at EDIRC.
Bibliographic data for series maintained by Paula Drew ().