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The interdependences of central bank’s forecasts and economic agents inflation expectations.Empirical study

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  • Magdalena Szyszko

    (Wyższa Szkoła Bankowa w Poznaniu, Katedra Bankowości i Rynku Finansowego)

Abstract

This paper focuses on the associations between the inflation forecasts of the central bank and inflation expectations of the households. The first part is of a descriptive nature. It gives the theoretical background of modern monetary policy focusing on the role of expectations. It also presents the idea of inflation forecast targeting. Then the framework of the inflation forecast targeting in four countries: the Czech Republic, Hungary, Poland and Romania is presented. The empirical part of the study is an attempt to find associations between the inflation forecasts results and inflation expectations of consumers derived on the basis of surveys. The theory gives sound background for the existence of such relationships.The interdependences are tested in several ways. The last part of the paper focuses on the results and conclusions.

Suggested Citation

  • Magdalena Szyszko, 2011. "The interdependences of central bank’s forecasts and economic agents inflation expectations.Empirical study," NBP Working Papers 105, Narodowy Bank Polski, Economic Research Department.
  • Handle: RePEc:nbp:nbpmis:105
    Note: This research project was conducted under the NBP Economic Research Committee’s open competition for research projects to be carried out by the NBP staff and economists from outside the NBP and was financed by the National Bank of Poland.
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    References listed on IDEAS

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    1. Kai Leitemo, 2006. "Open-Economy Inflation-Forecast Targeting," German Economic Review, Verein für Socialpolitik, vol. 7, pages 35-64, February.
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    Cited by:

    1. Magdalena Szyszko, . "Central Bank’s Inflation Forecast and Expectations. A Comparative Analysis," Prague Economic Papers, University of Economics, Prague, vol. 0, pages 1-14.

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    More about this item

    Keywords

    inflation forecasts; inflation forecasts targeting; inflation expectations;
    All these keywords.

    JEL classification:

    • 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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