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Inflation Persistence And Core Inflation: The Case Of South Africa

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  • Logan Rangasamy

Abstract

This paper analyses the persistence of inflation in South Africa since 1981. A measure of the persistence of inflation provides important information about the impact of shocks on the economy over time. This information can be extremely useful for the purpose of setting monetary policy, especially in a small, open economy like South Africa. In addition, an estimate of persistence at the disaggregate level helps in the identification of the main drivers of aggregate inflation. This information is useful in deriving a core measure of South African inflation, which outperforms some of the more readily available core measures in identifying the underlying inflationary pressures in the economy. Copyright (c) 2009 The Author. Journal compilation (c) 2009 Economic Society of South Africa.

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  • Logan Rangasamy, 2009. "Inflation Persistence And Core Inflation: The Case Of South Africa," South African Journal of Economics, Economic Society of South Africa, vol. 77(3), pages 430-444, September.
  • Handle: RePEc:bla:sajeco:v:77:y:2009:i:3:p:430-444
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    Citations

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    Cited by:

    1. Francis Leni Anguyo & Rangan Gupta & Kevin Kotze, 2017. "Inflation Dynamics in Uganda: A Quantile Regression Approach," School of Economics Macroeconomic Discussion Paper Series 2017-07, School of Economics, University of Cape Town.
    2. Logan Rangasamy, 2011. "Food Inflation In South Africa: Some Implications For Economic Policy," South African Journal of Economics, Economic Society of South Africa, vol. 79(2), pages 184-201, June.
    3. Andrew Phiri, 2013. "An inquisition into bivariate threshold effects in the inflation-growth correlation: Evaluating South Africa’s macroeconomic objectives," Business and Economic Horizons (BEH), Prague Development Center, vol. 9(3), pages 1-11, October.
    4. Franz Ruch & Stan du Plessis, 2015. "Working Paper – WP/15/05- Second-Round Effects from Food and Energy Prices- an SBVAR approach," Papers 7008, South African Reserve Bank.
    5. Faul, Joseph & Khumalo, Bridgette & Pashe, Mpho & Khuzwayo, Miranda & Banda, Kamogelo & Jali, Senzo & Myeni, Bathandekile & Pule, Retlaodirela & Mosito, Boitshoko & Jack, Lona-u-Thando & Phiri, Andrew, 2014. "Is South Africa's inflation target too persistent for monetary policy conduct?," MPRA Paper 58233, University Library of Munich, Germany.
    6. Franz Ruch & Dirk Bester, 2013. "Towards a Measure of Core Inflation using Singular Spectrum Analysis," South African Journal of Economics, Economic Society of South Africa, vol. 81(3), pages 307-329, September.
    7. Mehmet Balcilar & Rangan Gupta & Charl Jooste, 2016. "Analyzing South Africa’s inflation persistence using an ARFIMA model with Markov-switching fractional differencing parameter," Journal of Developing Areas, Tennessee State University, College of Business, vol. 50(1), pages 47-57, January-M.
    8. Luis Alberiko Gil-Alaña & Juan C. Cuestas & Estefania Mourelle, 2011. "Is there asymmetric behaviour in African inflation? A non-linear approach," NCID Working Papers 03/2011, Navarra Center for International Development, University of Navarra.
    9. Tianfeng Li & June Wei, 2015. "Multiple Structural Breaks and Inflation Persistence: Evidence from China," Asian Economic Journal, East Asian Economic Association, vol. 29(1), pages 1-20, March.
    10. Stan Plessis & Gideon Rand & Kevin Kotzé, 2015. "Measuring Core Inflation in South Africa," South African Journal of Economics, Economic Society of South Africa, vol. 83(4), pages 527-548, December.
    11. Stan du Plessis, 2014. "Targeting core inflation in emerging market economies," Working Papers 23/2014, Stellenbosch University, Department of Economics.
    12. Phiri, Andrew, 2017. "Inflation persistence in BRICS countries: A quantile autoregressive (QAR) model," MPRA Paper 79956, University Library of Munich, Germany.
    13. Franz Ruch & Mehmet Balcilar Author-Name-First Mehmet & Mampho P. Modise & Rangan Gupta, 2015. "Forecasting Core Inflation: The Case of South Africa," Working Papers 15-08, Eastern Mediterranean University, Department of Economics.
    14. Andrew Phiri, 2017. "Inflation persistence in BRICS countries: A quantile autoregressive (QAR) approach," Working Papers 1702, Department of Economics, Nelson Mandela University, revised Jul 2017.
    15. Gil-Alana, Luis A., 2011. "Inflation in South Africa. A long memory approach," Economics Letters, Elsevier, vol. 111(3), pages 207-209, June.
    16. Stan du Plessis, Gideon du Rand & Kevin Kotzé, 2015. "Measuring Core Inflation in South Africa," Working Papers 503, Economic Research Southern Africa.
    17. Rangan Gupta & Charl Jooste & Omid Ranjbar, 2015. "The Changing Dynamics of South Africa's Inflation Persistence: Evidence from a Quantile Regression Framework," Working Papers 201563, University of Pretoria, Department of Economics.
    18. Phiri, Andrew, 2016. "Changes in inflation persistence prior and subsequent to the subprime crisis: What are the implications for South Africa?," MPRA Paper 70645, University Library of Munich, Germany.

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