Asymmetric Monetary Policy in the Czech Republic?
In: Evaluation of the Fulfilment of the CNB's Inflation Targets 1998-2007
This paper analyses a hypothesis, whether an asymmetric monetary policy could contribute to the undershooting of the inflation targets of the Czech National Bank in the years 1998-2007. To this goal, a non-linear Taylor Rule has been estimated. The results indicate that – upon the introduction of inflation targeting – the Czech National Bank responded more aggressively to forecasts of inflation heading above the target. That asymmetric monetary policy, however, disappears if we perform estimates of the monetary policy rule exclusively on the basis of more contemporary data (approx. 2002-2007). Therefore, it could be deemed that symmetric handling of the inflation targets prevailed in the past several years.
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This chapter was published in: | This item is provided by Czech National Bank, Research Department in its series Occasional Publications - Chapters in Edited Volumes with number
09. | Handle: | RePEc:cnb:ocpubc:09 | Contact details of provider: | Postal: | Phone: 00420 2 2442 1111 Fax: 00420 2 2421 8522 Web page: http://www.cnb.cz/en/research/research_intro/Email: More information through EDIRC
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