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Čtyři zamyšlení nad cílováním inflace v České republice
[Four reflections on practising inflation targeting in the Czech Republic]

Author

Listed:
  • Oldřich Dědek

Abstract

The paper consists of four parts each of them devoted to a practical aspect of inflation targeting as conducted by the Czech National Bank. The first part outlines the reasons that led to the adoption of this monetary regime and summarises other advantages for effective and transparent decision-making. The second part addresses the issue of missing inflation targets. It is argued that simple confrontation of targets with actual behaviour of inflation may give a distorted view about the actual performance of monetary policy. The third part discusses a subtle methodological controversy about the difference between so-called escape clauses on the one hand and net inflation on the other. In the last section the author presents his critical view about the role of unconditional forecast in its capacity to indicate future interest rate decisions and to provide a realistic description of transmission mechanism in a small open economy.

Suggested Citation

  • Oldřich Dědek, 2004. "Čtyři zamyšlení nad cílováním inflace v České republice
    [Four reflections on practising inflation targeting in the Czech Republic]
    ," Politická ekonomie, University of Economics, Prague, vol. 2004(2).
  • Handle: RePEc:prg:jnlpol:v:2004:y:2004:i:2:id:454
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    References listed on IDEAS

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    16. repec:ilo:ilowps:374124 is not listed on IDEAS
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    More about this item

    Keywords

    monetary policy; inflation targeting; inflation forecast;

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications
    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
    • E47 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Forecasting and Simulation: Models and Applications
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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