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Effectiveness and Commitment To Inflation Targeting Policy: Evidences From Indonesia and Thailand

  • Siregar, Reza Yamora
  • Goo, Siwei

The chief objective of our paper is to highlight basic features of the IT policies adopted by Indonesia and Thailand, and to evaluate the commitment of the monetary authorities and the overall performances of the IT regime. The results demonstrate that the IT regime in these two economies has had some success, but not during the immediate aftermath of the Lehman Brothers' collapse in the last quarter of 2008. Furthermore, the implementations of the IT policy in these two Southeast Asian economies have largely been "flexible" during the stable period, seeking the balance between narrowing output gap, managing exchange rate volatility, and anchoring inflationary pressure. However during the turbulent period, there had been a heightened focus in anchoring inflationary expectation. (This paper has also been published in the Journal of Asian Economics, Vol. 21, No.2, April 2010, http://www.sciencedirect.com/science/journal/10490078).

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This book is provided by South East Asian Central Banks (SEACEN) Research and Training Centre in its series Staff Papers with number sp73 and published in 2009.
ISBN: 983-9478-78-8
Handle: RePEc:sea:spaper:sp73
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