IDEAS home Printed from
   My bibliography  Save this paper

Inflation targeting in the UK: Lessons for the Czech Republic


  • Katerina Smidkova


The paper tries to derive lessons from the UK experience with inflation targeting (IT) for the Czech monetary policy. Reasons for introducing the IT in both countries have been very similar. After intermediate targets failed, both central banks searched for a new strategy. When implementing the IT scheme, their approaches have been very similar although in some cases different tools have been implemented in order to overcome generally recognized problems. For example, flexibility has been gained by reduction in targeted index in the Czech case while explicit exemptions have been introduced in the UK case. The UK experience with the IT shows that inflation might be reduced towards targeted level faster than expected. Some other policy dilemmas from the UK experience appear relevant for the Czech central bank. For example, due to exchange-rate appreciation, domestically produced inflation might exceed aggregate inflation. The paper also concentrates on role of forecasting in the IT framework.

Suggested Citation

  • Katerina Smidkova, 2003. "Inflation targeting in the UK: Lessons for the Czech Republic," Macroeconomics 0304006, EconWPA.
  • Handle: RePEc:wpa:wuwpma:0304006
    Note: Type of Document - ; pages: 21 . This policy note from 1998 has not been published elsewhere.

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Andrew Haldane, 1997. "Some Issues in Inflation Targeting," Bank of England working papers 74, Bank of England.
    2. Clive Briault & Andrew Haldane & Mervyn King, 1996. "Independence and Accountability," Bank of England working papers 49, Bank of England.
    3. Mervyn King, 1994. "Monetary policy in the UK," Fiscal Studies, Institute for Fiscal Studies, vol. 15(3), pages 109-128, August.
    Full references (including those not matched with items on IDEAS)

    More about this item


    Czech inflation targeting strategy;

    JEL classification:

    • E - Macroeconomics and Monetary Economics

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpma:0304006. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.