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Inflation-linked bonds from a central bank perspective

  • Juan Angel Garcia

    ()

    (Europena Central Bank)

  • Adrian van Rixtel

    ()

    (Banco de España)

Inflation-linked bond markets have experienced significant growth in recent years. This growth is somewhat surprising, for inflation-linked bonds cannot be considered a financial innovation and their development has taken place in a period of historically low global inflation and inflation expectations. In this context, the purpose of this paper is twofold. First, it provides a selective survey of the key arguments for and against the issuance of inflation-linked debt, and some of the factors that help to understand their recent growth. Second, it illustrates the use of these instruments to better monitor investors’ inflation expectations and growth prospects from a central bank perspective.

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File URL: http://www.bde.es/f/webbde/SES/Secciones/Publicaciones/PublicacionesSeriadas/DocumentosOcasionales/07/Fic/do0705e.pdf
File Function: First version, August 2007
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Paper provided by Banco de Espa�a in its series Banco de Espa�a Occasional Papers with number 0705.

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Length: 45 pages
Date of creation: Aug 2007
Date of revision:
Handle: RePEc:bde:opaper:0705
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