Stability Price Index, Core Inflation and Output Volatility
This paper examines the relationship between the ‘exclusion’ type core inflation measures and the stability price index. Empirical results for Malaysia and Pakistan suggests that, if targeting core inflation index is to stabilize output, weights of the export-oriented sectors (energy for Malaysia and foodstuffs for Pakistan) should be reduces, in relation to the consumers’ price index weights, and for import-oriented sectors, increased. It also indicates that, in order to maintain real sector stability, central bankers should include the fundamental component of the stock market prices in the price index they target.
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- N. Gregory Mankiw & Ricardo Reis, 2002.
"What Measure of Inflation Should a Central Bank Target?,"
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9375, National Bureau of Economic Research, Inc.
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- Mankiw, N. Gregory & Reis, Ricardo, 2003. "What Measure of Inflation Should a Central Bank Target?," Scholarly Articles 3415322, Harvard University Department of Economics.
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- Alberto Humala & Gabriel Rodríguez, 2011.
"A Factorial Decomposition Of Inflation In Peru, An Alternative Measure Of Core Inflation,"
Documentos de Trabajo / Working Papers
2011-315, Departamento de Economía - Pontificia Universidad Católica del Perú.
- Alberto Humala & Gabriel Rodríguez, 2012. "A factorial decomposition of inflation in Peru: an alternative measure of core inflation," Applied Economics Letters, Taylor & Francis Journals, vol. 19(14), pages 1331-1334, September.
- Morana, Claudio, 2004.
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Working Paper Series
0305, European Central Bank.
- Claudio Morana, 2007. "A structural common factor approach to core inflation estimation and forecasting," Applied Economics Letters, Taylor & Francis Journals, vol. 14(3), pages 163-169.
- Stephen G. Cecchetti & Kim, 2004.
"Inflation Targeting, Price-Path Targeting, and Output Variability,"
in: The Inflation-Targeting Debate, pages 173-200
National Bureau of Economic Research, Inc.
- Stephen G. Cecchetti & Junhan Kim, 2003. "Inflation Targeting, Price-Path Targeting and Output Variability," NBER Working Papers 9672, National Bureau of Economic Research, Inc.
- Ricardo Reis, 2005. "A Dynamic Measure of Inflation," NBER Working Papers 11746, National Bureau of Economic Research, Inc.
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